Post Harvest Profile of Wheat

CONTENTS
PAGE NO.
1.0 INTRODUCTION -- 1
1.1 Origin -- 1
1.2 Importance -- 1
2.0 PRODUCTION -- 2
2.1 Major Wheat Producing Countries in the World -- 2
2.2 Major Wheat Producing States in India -- 3
2.3 Zone wise Major Commercial Varieties of Wheat -- 4
3.0 POST HARVEST MANAGEMENT -- 5
3.1 Post Harvest Losses -- 5
3.2 Harvesting Care -- 6
3.2.1 Post Harvest Equipments -- 7
3.3 Grading -- 9
3.3.1 Grade Specifications -- 9
3.3.2 Grading at Producers’ Level -- 10
3.4 Adulterants and Toxins -- 17
3.5 Packaging -- 19
3.6 Transportation -- 20
3.7 Storage -- 23
3.7.1 Major Stored Grain Pests and Control Measures -- 24
3.7.2 Storage structures -- 27
3.7.3 Storage Facilities -- 28
i) Producer s’ storage facilities -- 28
ii) Rural godowns -- 29
iii) Mandi godowns -- 30
iv) FCI, CWC & SWC warehouses -- 30
v) Co-operative storage facilities -- 33
3.7.4 Pledge Finance System -- 34
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4.0 MARKETING PRACTICES AND CONSTRAINTS -- 37

4.1 Important Markets -- 38
4.1.1 Arrivals in Major Wheat Producing States -- 39
4.1.2 Despatches -- 41
4.2 Distribution -- 41
4.2.1 Inter-State Movement -- 42
4.3 Export and Import -- 45
4.3.1 Sanitary and Phyto Sanitary Requirement -- 47
4.3.2 Export Procedures -- 47
4.4 Marketing Constraints -- 48
5.0 MARKETING CHANNELS, COST AND MARGINS -- 49
5.1 Marketing Channels -- 49
5.2 Marketing Costs and Margins -- 51
6.0 MARKETING INFORMATION AND EXTENSION -- 54

7.0 ALTERNATIVE SYSTEMS OF MARKETING -- 55

7.1 Direct Marketing -- 55
7.2 Contract Farming -- 56
7.3 Co-operative Marketing -- 57
7.4 Forward and Future Markets -- 58
8.0 INSTITUTIONAL FACILITIES -- 60
8.1 Marketing Related Schemes of Govt./Public -- 60
Sector Organizations
8.2 Institutional Credit Facilities -- 61
8.3 Organizations/Agencies Providing Marketing Services -- 64
9.0 UTILIZATION -- 66
9.1 Processing -- 66
9.2 Uses -- 67
10.0 DO’S AND DON’TS -- 70
11.0 REFERENCES -- 72
ANNEXURES -- I - IV
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1.0 INTRODUCTION :
Importance of wheat world wide as main food can be understood by use of stylized wheat
spike as a symbol of FAO. Wheat is a major cereal in India after rice.The total estimated
production of foodgrains in India during the year 2000-2001 was 195.92 million tonnes and the
share of wheat was 68.76 million tonnes i.e. about 35 per
cent. India has emerged as the 2nd largest producer of
wheat after China and accounted for 12.06 per cent
share of total world production of wheat. Due to
sustained efforts made by policy makers, agricultural
scientists, extension workers and receptive farmers, the
production of wheat dramatically increased manifold on
account of adoption of modern production technology.
The production of wheat in India, which was merely 4
million tonnes during the year 1948 – 1949 increased
spectacularly to 72.8 million tonnes in 2002 – 2003. The
net per capita availability of wheat also increased from
65.7 gms. per day or 24.0 kgs. per annum in 1951 to 135.8 gms. or 49.6 kgs. in the year 2001.

1.1 Origin : Top

“Give us this day our daily bread” is an eternal prayer. Bread made from wheat has,
from ancient times, been referred to as the stuff of life. It continues to be, the most important
food grain of the world.

According to the well known studies of Vavilov, the North Western parts of the Indian Sub-
continent together with contiguous region of Afganistan was the centre of origin of bread wheat.
Archaeological investigations at Mohenjo-daro have shown that wheat was being grown in that
region about 5000 years ago. In fact, wheat was grown in India from pre-historic times. The
wheat belongs to the Genus Triticum of family Graminae. The wheat is having different names
in regional languages viz., Gehun, Kanak, Gandham in Hindi, Gehun, Gahang in Marathi,
Godhumalu in Telugu, Godhi in Kannad, Godumai, Godumbairisi in Tamil, Gendhkum, Godamba
in Malayalam. Although, as many as 25 species of wheat have been recognized in the world,
only three species of wheat namely; T-aestivum / vulgare Linn (Bread wheat), T.durum
(Macaroni wheat) and T.dicoccum (Emmer wheat) are commercially grown in India.

1.2 Importance :
Wheat kernel consists of four main parts – Seed coat (10 per cent of the kernel weight);
aleurone layer (6 per cent); starchy middle, the endosperm (81 per cent) and the germ (3 per
cent).

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Consumption of wheat became popular in all the states of country due to greater flow of
marketable surplus, spread of knowledge that whole meal atta contains double the quantity of
proteins and five times the quantity of calcium compared to consumption of equal quantity of
rice. Another factor which has been responsible for widespread consumption of wheat is its
gluten content, making it most versatile cereal with multifarious usage. It is responsible for
rheological features of dough. It absorbs and retains moisture, traps the gases in dough and
improves the crust colour. The proximate principles of wheat are as follows:

Moisture 12.8 gms Carbohydrate 71.2 gms

Proteins 11.8 gms Energy 346 K cal
Fat 1.5 gms Calcium 41 mg.
Minerals 1.5 gms Phosphorus 306 mg.
Fibre 1.2 gms Iron 5.3 mg.

All the values as per 100 gms. of edible portion.

SOURCE : Nutritive Composition of Indian Foods, NIN (ICMR), Hyderabad.

Average composition (percentage) of wheat according to S.B.Pingale, ICAR, New Delhi is

as follows.

Moisture 13.3 Crude Fibre 2.4

Protein 12.7 Fatty acids 22.5 mg.
Total Ash 1.4 Gluten 8

The different products of wheat commonly used are Atta (whole meal), which is rich in
Vitamin-A and Vitamin-B, whereas Maida (white flour) contains lesser Vitamin-B and protein
contents. Suji (coarse semolina), Rawa (fine semolina), Vermicelli, noodles are other products in
common use.

2.0 PRODUCTION :

2.1 Major Wheat Producing Countries in the World

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The wheat is cultivated in about 120 countries of the world. The major wheat producing
countries are China, India, USA, Russian Federation, Canada, Australia, etc. The China has
emerged as the largest producer of wheat and accounted for 15.7 per cent share followed by
India, which shared 12.06 per cent in world production of wheat during the years 2001-2003.
Although, India occupied largest area estimated at 12.08 per cent of total area under wheat in
the world followed by China which occupied 11.08 per cent, the productivity of wheat in China,
was appreciably higher at 3830 kgs. compared to 2696 kgs. per hectare in India. World area,
production and yield of wheat is summarized in the following table.

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Table No. 1
Average Area, Production and Yield of Wheat in the Major Producing
Countries of the World
Sl. Country Area (000’ Hect.) Production (000’ M.T.) Yield (Kg./Hect.)
No. 2001 2002 2003 Average 2001 2002 2003 Average 2001 2002 2003 Average
1. 2. 3. 4. 5. 6. 7. 8. 9. 10 11. 12. 13. 14.
1. India 25731 26345 24886 25654 69681 72766 65129 69192 2708 2762 2617 2696
(12.08) (12.06)
2. China 24664 23908 22040 23537 93873 90290 86100 90088 3806 3777 3906 3830
(11.08) (15.71)
3. USA 19681 18582 21383 19882 53262 44063 63590 53638 2706 2371 2974 2684
(9.36) (9.35)
4. Russian 22833 24478 19960 22424 46982 50609 34062 43884 2058 2068 1706 1944
Federation (10.56) (7.65)
5. Australia 11597 11045 12456 11699 24854 10059 24900 19938 2143 911 1999 1684
(5.51) (3.48)
6. Canada 10585 8866 10467 9963 20567 16198 23552 20106 1943 1833 2250 2009
(4.69) (3.51)
7. Others 99598 100522 97573 33231 281301 289528 259016 276615 2824 2880 2655 2786
(46.72) (48.24)
World 214689 213716 208765 212390 290520 573513 556349 573461 2751 2683 2665 2700
(100%) (100%)

SOURCE : FAO Production Year Book Vol.54 – 2000.

2.2 Major Wheat Producing States in India :

India has made tremendous progress in production of wheat. During the year 1950-1951,
its production was merely 6.46 million tonnes, which increased to 65.12 million tonnes in 2003. In
India, Uttar Pradesh, Punjab, Haryana, Rajasthan, Madhya Pradesh and Bihar together
contributed 93.31 per cent of production. The share of Uttar Pradesh alone was 34.89 per cent of
total production in India followed by Punjab, Haryana, Madhya Pradesh, Rajasthan and Bihar
with the share of 21.55, 13.20, 8.81, 8.57 and 6.2 per cent respectively. The area, production
and yield are presented in Table – 2.
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Table No. 2
Average Area, Production and Yield of Wheat of Major Producing States in India
Sl. State Area (000’ Hect.) Production (000’ Tonnes) Yield (Kg./Hectares)
No. 1999- 2000- 2001- Ave- 1999- 2000- 2001- Avera- 1999- 2000- 2001-
2000 2001 2002 rage 2000 2001 2002 ge 2000 2001 2002
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.
1. Uttar 9400 9240 9080 9240 25976 25170 25070 25405 2764 2724 2755
Pradesh (35.02) (34.98)
2. Punjab 3388 3410 3420 3406 15910 15550 15500 15653 4696 4563 4532
(12.91) (21.55)
3. Haryana 2317 2360 2300 2326 9650 9670 9440 9587 4165 4106 4103
(8.82) (13.20)
4. Rajasthan 2650 2310 2290 2417 6732 5550 6390 6224 2540 2402 2739
(9.16) (8.57)
5. Madhya 4662 3310 3430 3801 8685 4870 5630 6395 1863 1471 1642
Pradesh (14.41) (8.81)
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1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.

6. Bihar 2145 2070 2130 2115 4687 4440 4380 4502 2126 2146 2056
(8.02) (6.20)
7. Gujarat 0482 0290 0470 414 1020 0650 1140 937 2116 2268 2435
(1.57) (1.29)
8. Maharashtra 1049 0750 0780 860 1436 0950 1080 1155 1369 1257 1388
(3.26) (1.59)
9. Others 1393 1990 2020 1801 2273 2830 3180 2761 1632 2427 1574
(6.83) (3.81)
All India 27486 25730 25920 26380 76369 69680 71810 72619 2778 2708 2770
Total (100) (100)

SOURCE : Department of Agril. & Co-operation, New Delhi.

2.3 Zone-wise Commercial Varieties of Wheat :

The wheat growing area of the country can be divided into 5 agronomic divisions (i) the
Gangetic alluvium of Uttar Pradesh and Bihar (ii) the Indus alluvium of Punjab and
Haryana (iii) the black soils of Central and Southern India (iv) the hilly soils of the
Himalaya and elsewhere and (v) the desert soils of Rajasthan. The first two divisions are
most suitable for wheat cultivation.
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About 190 high yielding varieties of wheat have been released so far, as suitable to
different zones and cropping sequences. The improved wheat varieties suitable to various
wheat zones are as under:
Sl. No. Zone / State / Hills Varieties
1. 2. 3.
1. North Hills Zone V1, 616, HS277, V1, 421, UP 1109, HD 2380, HS 240, HT
(Hills of H.P., 46(T, HS 295, HS 207.
Uttaranchal & J& K)
2. North Western Normal sown, Irrigated
Plains Zone HD 2329, HD 2428, CPAN 3004, POW 215(d), OBD 34(d),
(Punjab, Haryana, PBW 154, 3077 Raj, 1.4 KRL, WH 542, UP 2338, HUW-468,
Western U.P., Delhi, PBW 343, HD 2687.
Rajasthan) Late sown, Irrigated
HD 2285, HD 2270, PBW 226, WH 291, Raj 2184, Raj 3077,
Raj 3765, UP 2336, PBW 377, Kundan, PBW 65,IWP-72.
Normal sown, rainfed
PBW 175, PBW 299, WL 410, PBW-65, WL-2265, WH-533,
K-9465, HDR-77
3. North Eastern Normal sown Irrigated
Plains Zone HP 1102, UP 262, HUW 206, K 7410, HD 2402, K 8804, DL
(Eastern U.P., 784-3, K 9006, K 9107, HP 1731.
Bihar, West Bengal, Late sown, Irrigated
Orissa, Jharkhand, HD 2307, HUW 234, HP 1633
Assam) Normal sown, rainfed
K 8027, HDR 77, K 8962.
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1. 2. 3.
4. Central Zone (M.P., Lok 1, WH 147, HD 2236, WH 1077, Raj. 1555(d), HI 838(d),
Chhattisgarh, Gujarat DL 803-3, GW 190, J 405, Swati, HD 2327, Sujata, JU 12,
and Kota & Udaipur Meghdoot (d), Narmada 4, Hyb 65.
(Rajasthan)
5. Peninsular Zone HD 2189, HD 4502(D), HD 2380, DWR 39, DWR 162, MACS
(Maharashtra, 2496, HI 977, HD 2502, HD 2610, DWR 195, HI 5439, MACS
Karnataka) 1967(d)
6. Southern Hill Zone HW 741, HW 971, HUW 318, NP 200(d), NP 200(d)
(Nilgiri and Palni Hills)
SOURCE: Indian Farming, October, 2001.

Durum wheat (T.durum) occupies nearly 10% of the wheat area in the country. Earlier, its
cultivation was confined to rainfed areas of Central and Peninsular India. But now, semi dwarf
variety is cultivated in irrigated areas also. Recently evolved durum varieties, such as HI 8381,
and HI 8498 are not only high yielding and resistant to yellow rust and Karnal-bunt but also suit
the export requirements. These durum varieties are hardest in texture with long and amber
coloured Kernel. High gluten content with granular structure and its non-binding properties make
it suitable for pasta industry. Pasta made from durum is firm with consistent cooking quality.
Yellow endosperm gives a desirable golden hue.

3.0 POST HARVEST MANAGEMENT : Top

The farmer’s risk does not end when the crop matures, grain may be lost during harvest
because of shattering and spillage or birds, rodents and insects may consume/damage it in the
field or in storage. Whereas, early harvesting results in the grains with higher moisture content,
which in turn may attract mould infestation resulting into development of aflatoxin. The post-
harvest losses can be reduced to half with the use of available technology viz., timely harvest,
use of proper harvesting and threshing equipments, safe storage, prophylactic and curative
measures to check infestation. However, farmers are not fully aware of the post-harvest losses
during harvesting and storing etc.

3.1 Post Harvest Losses :

The post-harvest losses of wheat are estimated to the tune of 8 per cent of production.
There are different estimates on post harvest losses in foodgrains. According to one estimate,
the harvest and post harvest losses are as follows:
Sl. Losses (during Percentage Sl. Losses (during Percentage
No. and other causes) (of Losses) No. and other causes) (of Losses)
1. Threshing 1.0 5. Birds 0.5
2. Transport 0.5 6. Insect 3.0
3. Processing - 7. Moisture 0.5
4. Rodents 2.50 Total : 8.0

SOURCE : Report of the Committee on Post Harvest Losses of Foodgrains

In India, Ministry of Food and Agriculture, Govt. of India, 1971.
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As per Directorate of Marketing and Inspection recent survey, the estimated total post-
harvest losses at producer’s level has been 1.79 per cent (unpublished).

Loss of 7 million tonnes @ 10 per cent of wheat production is colossal, which country can
ill afford. In terms of the value, this works out to Rs.35 million by conservative estimates @ Rs.5
per kg. However, following measures should be followed to minimize the post-harvest losses;
) Immediate drying of wet grain after harvest.
) Uniform drying to avoid hot and wet spots.
) Use of proper techniques of processing to avoid losses in threshing
and winnowing by mechanical methods.
) Proper sanitation during drying and storing to avoid contamination of
grains and protection from insects, rodents and birds.
) Use of efficient and good packaging for storage and transportation.
) Use of proper scientific techniques in storage for maintaining optimum
moisture content.
) Use of pest control measures (fumigation) prior and during storage.
) Providing aeration to stored grains and stir grain bulk occasionally.
) Moving stocks in sacks to discourage pest incidence and its
multiplication.
) Proper handling of wheat with suitable transportation facilities helps in
reduction in losses at farm and market level.

3.2 Harvesting Care : Top

The time of harvesting plays a vital role. The following harvesting care should be taken.

¾ Wheat crop should be harvested, when the grains become hard.

¾ Harvesting before maturity means low recovery of grain, higher
proportion of immature seeds, broken and poor quality and disease
prone during storage.
¾ Delay in harvesting means shattering and spillage of grains. Its
exposure to birds, rodents and insect and pest attack.
¾ Harvesting should be done in dry summer season.
¾ Harvesting should be done by using proper method and improved
equipments.
¾ Harvested wheat should be kept separately to avoid mixing of varieties.
¾ Direct sun drying and excessive drying should be avoided.
¾ Threshing and winnowing should be done in the fields. The grains
should be packed in sound clean gunny bags to minimize the losses
during transportation.
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3.2.1 Post – Harvest Equipments :
Some modern, developed equipments with efficiency and cost are give below.
POST HARVEST EQUIPMENT
Sl. Equipment Capa- Effici- Labour Price Cost Pictures
No. (with code bility ency required Rs. Rs. /Ha.
no.) Ha./Hr. % man. ‘x’
Hr./ Ha. ‘x’
1. 2. 3. 4. 5. 6. 7. 8.
A. SOWING AND PLANTING EQUIPMENT
1. PAU Tractor 0.3 – 75 – 80 5 7000 300
Mounted Seed- 0.4
cum-fertilizer
drill for oilseed
(Also useful for
wheat sowing)
SP – 21

B. PLANT PROTECTION EQUIPMENT

1. Battery 0.20 - 5 80 95
powered low
volume
knapsack
spinning disc
sprayer PP – 1
C. HARVESTING EQUIPMENTS
1. Vaibhav Sickle 0.011 89 20 334
HV – 3

2. Self Propelled 0.20 – 65 13 665 1400

Vertical 0.23
Conveyor
Reaper HV – 8

3. Self Propelled 0.175 68.5 6 60000 320

Rice Harvester
(Also used for
wheat) HV – 9

‘x’ – Approximate price. Top

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1. 2. 3. 4. 5. 6. 7. 8.
4. Power Tiller
Operated Vertical 0.25 - 4 20000 600
Conveyor Reaper
Windrower
HV – 10

5. CIAE Tractor
Front Mounted 0.31 74 46 30000 400
Vertical
Conveying
Reaper
Windrower
HV – 12
6. PAU Tractor
Front Mounted 0.3 – 55 – 70 30 – 40 30000 750
Vertical 0.4
Conveyor
Reaper
Windrower

D THRESHING / SHELLING EQUIPMENT

1. Pantnagar Axial 312 TE - MH per 25000 Rs.10
Flow multicrop kg. per 99.0%` qtl. 1.0 per qtl.
Thresher hours CE-
TH – 25 99.2%

E MISCELLANEOUS EQUIPMENT
1. APAU Seed 10 kg 90% 1 1200 Rs. 1.7
Treating Drum at a per kg.
MC – 1 time
100
kg.per
hour

TE=Threshing Efficiency CE=Cleaning Efficiency

SOURCE : Farm Machinery Research Digest – Central Institute of Agril.
Engineering (CIAR), Bhopal

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Punjab Sickle HV-II Naveen Sickle HV-I

Wheat Thresher Multicrop Thresher

3.3 Grading:
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There is no need to emphasize that bold size grains free from chaff, brokens, immature,
shrivelled and weevil damaged free from admixture of other varieties, foreign matter, fetch higher
prices. In the modern urban market, ready to cook items are in demand with increased
purchasing capacity. Since the wheat is produced in varying agro-climatic conditions,
heterogeneous quality is unavoidable. Hence, it is necessary to have one national language for
defining the quality characteristics to facilitate marketing without physical inspection. Grading
provides following marketing benefits –

 Low expenditure in transport and storage.

 Knowledge of prevailing price, and right markets.
 Easy financial assistance, and future trading.
 Widens the market for farm products.
 Consumers get wide choice of quality at a reasonable price.
 Promotes competitive marketing.

3.3.1 Grade Specifications :

(A) Grading is undertaken by different agencies following various criteria depending upon its
end use. The bulk of the commodity may be simply classified on the basis of kernel texture as
(i) hard (ii) semi hard (iii) soft and on colour namely (i) white (ii) amber and (ii) red.

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The various factors which constitute quality are (i) impurities, which together with
damaged grain may seriously affect milling quality, (ii) bushel and kernel
weight, (iii) nature and structure of the kernel, and (iv) moisture content. The
merchants in India consider mainly physical characters like impurity or refraction and general
appearance of the grain. Refraction comprises of any one or a combination of the following:-

) Dirt or foreign matter including oilseeds and non food grains,

) Admixture of other food grains,
) Damaged and ‘touched’ grains,
) Shrivilled or immature grains,
) Weevilled grains,

(B) Grading Equipments :

(1) Sampler – Tube or Scoop, Sample Divider Wheat Sample-50 gm. (2) Cleaning
and Grading System Machine (3) Dust Collection Plant (4) Screen Air Separation (5) Clean-
o-Graders (6) Destoners (7) Gravity Separators (8) Air Classifiers (9) Pre-cleaning and Silo
Storage System (10) Aflatoxin Detection Kit – CFTRI.

3.3.2 Grading at Producers Level :

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The grading of wheat at producer’s level is carried out in accordance with National Grade
Standards since 1965. The produce brought by farmers is inspected and sampled by qualified
and trained graders of APMCs. The quantity and value of wheat graded increased in the year
2000-2001 as compared to previous year. The share of Northern Region accounted for as much
as 95 per cent in 2002. As per the provisional estimate, the quantity and value of wheat graded
at market level prior to sale maintained increasing trends during the year 2002 – 2003.

Table N0.3
I) Progress of Grading at Producer’s Level

Sl. 2000 – 2001 2001 – 2002 2002 – 2003 (P)

No.
1. Quantity (M.T.) 1283916.50 1253716 1447094
2. Value (Rs.Lakhs) 83157.72 80932.57 90133.15

SOURCE : Directorate of Marketing and Inspection, Faridabad.

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Table No.4
Region-wise / State-wise Grading of Quantity and Value of Wheat Graded
Wheat at Producer’s Level (2001 – 2002) at Producer’s Level in Major Wheat
Producing States (in percentage)
Sl. State / Quantity Value
No. Region (M.T) (Rs.L)
1. Uttar 856816 58362.51
Pradesh
2. Punjab 233825 14261.08
3. Haryana 62000 3782.00
Northern 1191558 77522.01
Region
4. Rajasthan 38917 1116.42
5. Maharashtra 61998 3399.71
6. Gujarat 147 9.91
Western 62145 3409.62
Region
7. Karnataka 13 0.94
Southern 13 0.94
Region
All India 1253716 80932.57

SOURCE : Agmark Grading Statistics, 2002-03

II) Directorate of Marketing and Inspection (DMI) : Top

The DMI under Ministry of Agriculture, Government of India has laid down grade
specifications of wheat, which are known as the National Grade Standards. These are generally
adopted in warehouses and regulated markets for grading. The Agmark grade specifications
have been under Agricultural Produce (Grading & Marking) Act. 1937.

Agmark Grade Designation and Definition of Quality of Wheat

A. General Characteristics :

) wheat shall be the dried grains of Triticum vulgare and Triticum durum
Desf;
) have uniform size, shape and colour;
) be sweet, hard, clean, whole-some and free from moulds, weevils
obnoxious smell, discolouration, admixture of deleterious substances
and all other impurities except to the extent indicated in the Schedule;
) be in sound merchantable condition; and
) not have moisture exceeding 12 per cent.
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B. Special Characteristics :

Grade Special characteristics

desig- Maximum limits of tolerance 1% by weight
nation
Foreign Other Other Damaged Slightly Immature Weevilled
Matter Food Wheats Grains Damaged shriveled and grains
Grains Grains broken grains
I 1.5 1.6 5.0 1.0 2.0 2.0 1.0
II 2.5 3.0 15.0 2.0 4.0 4.0 3.0
III 3.5 6.0 20.0 4.0 6.0 10.0 6.0
IV 4.0 8.0 20.0 5.0 10.0 10.0 10.0

C. Definition :
Foreign matter : It includes, dust, stones, lumps of earth, chaff, stem of straw and any
other impurity including non-edible seeds.
Other Food Grains : Edible foodgrains other than wheat.
Other Wheats : For this purpose wheat would be divided into two classes – (1) Durum
or Macroni wheat and (2) Vulgare or common wheat; Durum again
would be sub-divided into two groups (i) amber and (ii) red ; and
Vulgare would be sub-divided in to three groups – (i) white (ii) amber
and (iii) red.
Damaged Grains : Grains that are internally damaged or discoloured, damage and
discolouration materially affecting the quality.
Slightly Damaged : Grains that are superficially damaged or discoloured, damage
Grains and discolouration not materially affecting the quality.
Immature, Shrivelled : Immature and shrivelled grains are those that are not properly
& Broken Grains developed. Broken grains are pieces of whole grains.
Weevilled Grains : Grains that are partially or wholly bored or eaten by weevil or other
grain insects.

N.B. – Grades I and II should be free from living insect infestation.

III) Codex Standards :

The Codex Alimentarius Commission was set up in the year 1963 by FAO and WHO to
develop food standards, guidelines and related texts such as code of practice under the Joint
FAO/WHO Food Standards Programme. The main purposes of this programme are to protect
health of the consumer, ensure fair trade practices in the food trade, and promote coordination of
all food standards work undertaken by the international governmental and non-governmental
organizations. The Commission has developed more than 200 standards in the prescribed
format for individual or group of foods including the General Standards for labeling of pre-packed
foods, the Codex Central guidelines on claims and the Codex Guidelines on Nutritional Labeling
etc.
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IV) Grade Specifications of Central Warehousing Corporation (CWC):

The Central Warehousing Corporation has adopted PFA standards on the basis of
gravimetric (percentage by weight) as indicated below :
Foreign Other edible Damaged Weevilled Moisture Total (1+2+3)
matter Grains Grains Grains shall not exceed
3.0 6.0 6.0 10 by 14 12.0
count

Foreign matter : Not more than 3 per cent, of this inorganic matter and poisonous
seeds not more than 1.0 per cent and 0.5 per cent respectively. Of
the total 0.5 per cent of poisonous seeds, Dhatura and Akra shall not
exceed 0.025 per cent and 0.2 per cent respectively.
Damaged Grains : Not more than 6 per cent including Karnal bunt and ergot affected
grains, Karnal bunt shall not exceed 3.0 per cent and ergot affected
shall not exceed 0.05 per cent.

Uric Acid – not more than 100 mg. per kg.

Mycotoxin – not more than 30 micrograms per kg. Top

Further categorization has been done on weevilled grains as well as the touched / germ
eaten grains.
Wheat/Milo/Jowar - on the basis of weevilling percentage
Category % of wevilled grains by weight
A Upto 1%
B Above 1% to 4%
C Above 4% to 7%
D Above 7% to 15

V) Grade Specifications of Food Corporation of India (FCI) :

FCI follows two types of grade specifications based on the end use of wheat.

i) For General Pool : Specifications are based on PFA standards.

F.C.I. Specifications for Wheat Based on P.F.A. Standards
Grade Foreign Other Damaged Slightly Shriveled
matter Foodgrains including Karnal damaged broken
Bunt & ergot
Grade-I 0.75% 3.0% 3.0% 6.0% 8.0%
(2001-02)
Grade-I o.75% 2.0% 2.0% 6.0% 7.0%
(2002-03*)
* Specified for the crop year 2004-05 Top
Figures show the percentage limit on weight basis
13
 Top
Note: Foreign matter- Not more than 1.0 per cent by weight (minerals not more than 0.25
per cent and animal origin not more than 0.10 per cent).
Damaged Grain - Not more than 6 per cent by weight -
i) Karnal Bunt affected shall not exceed 3 per cent (by weight)
ii) Ergot affected grains shall not exceed 0.05 per cent (by
weight)
Weevilled Grains - Not more than 10 per cent by count and Uric acid not more than 100
mg./kg.
Rodent Hair and - Shall not exceed 5 pcs/kg. - omitted from PFA standards
Excreta vide G.S.R.No.165(E), dt.07.03.2001 implemented w.e.f. 07.06.2001.
Other Edible grains - Not more than 6 per cent by weight.
Moisture - Not more than 14 per cent by weight obtained by heating
pulverized grains at 13.0-13.30C for two hrs.
ii) For Defence Personnel : F.C.I. procures for Defence supply on the basis of
Army Supply Corp. (ASC) Specifications. Chemical
test is also conducted in Central Food Labs. No
Chemical Test by FCI.
WHEAT - TEST WEIGHT (Hectoliter basis) in kg. Top
Variety Punjab Haryana
PV-18 75.3 - 77.6 77.50 - 85.40
Kalyan 73.6 - 77.5 75.40 - 82.60
S-308 75.4 - 81.0 77.40 - 83.40
Deshi 76.4 - 82.1 78.50 - 82.40
RR-21 - 81.70 - 82.30

VI) Grade Specifications of Prevention of Food Adulteration Act, 1955 (PFA) :

Wheat being primary food a total of 8 insects either live or dead per kg. are permitted.

Description - Wheat shall be the dried mature grains of Ttriticum aestivum or Triticum
vulgare, Triticum durum, Triticum sphaeercoccum. Triticum dicoccum, Triticum, Compactum. It
shall be sweet, clean and wholesome. It shall also conform to the following standards, namely:
¾ Moisture - Not more than 14 per cent by weight (obtained by heating
the pulverized grains at 13.00C – 13.30C for two hours.
¾ Foreign matter - Not more than 1 per cent by weight of which not more
than 0.25 per cent private shall be mineral matter and not
more than 0.10 per cent by weight shall be impurities of
animal origin.
¾ Other edible grains - Not more than 6 per cent by weight.
Top
14

¾ Damaged grains
¾ Weevilled grains
¾ Uric acid
¾ Aflatoxin
¾ Deoxynivalenol (DON)-
Top
- Not more than 6.0 per cent by weight including Karnal
bunt affected grains and ergot-affected grains. The limit
of Karnal bunt affected grains, ergot affected grains shall
not exceed 3.0 per cent and 0.05 per cent by weight,
respectively.
- Not more than 10 per cent by count.
- Not more than 100 mg. per kg.
- Not more than 38 micrograms per kg.
Not more than 1000 micrograms per kg.

Provided that the total of foreign matter, other edible grains and damaged grains shall not
exceed 12 per cent by weight.

Quality Status of Indian Wheat :

Wheat possesses certain unique properties, most important of which include the ability of
its proteins, when mixed with water to form a cohesive elastic substance called Gluten. Gluten is
that portion of wheat protein, which is responsible for providing the framework for spongy texture
of bread and other baked products. On dry weight basis, gluten consists of 75 – 80 per cent
protein and 5 to 10 per cent lipids. To form gluten, both gliadin and glutenin are necessary.
Glutenin is said impart solidity to the gluten and gliadin is responsible for softness and
stickyness. The gliadin sticks to the glutenin and so prevents it being washed away in the
process of washing out of the gluten. While gliadin is soluble in 60 per cent aqueous alcohol, the
glutenin is insoluble in neutral solvents but soluble in acidic or alkaline solvents.
Top
Quality characteristics of wheat depend on variety, agro-climatic conditions, production
technology, cultural practices, etc. it has been proved beyond doubt that same variety grown in
different areas produces wheat with varying quality characteristics. Grains of WH 147 made best
chapatti (Score 7.25/10), when grown at Niphad and poorest [5.58/10 ], when produced at Jobner.
Even pre-harvest treatments also influence post- harvest characteristics.

Different quality parameters like, admixture, damaged and shriveled grains, colour,
hardness, protein, sedimentation value, spread factor, etc. are considered in different countries.
In 1970-71, the parameters for Fair Average Quality (FAQ) of FCI were foreign mater, other food
grains, slightly damaged and shrivelled grains. However in 1977-78, the maximum limits were
improvised and concept of four grades was developed.

Now in post WTO era, surplus stocks of wheat changed consumer preferences /
consumption pattern, emphasis on market driven production, export and value addition. The
Market Intervention Scheme (MIS) parameters can not be used for export. In due course of
time, quality factors shall get integrated facilitating direct delivery from farm gate to end users
saving time, transportation and storage cost.

Top
15
 Top
International parameters like, hectolitre weight, total defect
percentage, moisture, sedimentation value, hardness, protein, etc.
and product specific quality factors viz. Alkaline water retention
capacity (AWRC – percentage), extraction rate, dough properties,
spread factor etc. are to be taken in to account.

An earlier analysis of wheat samples of different varieties grown in different locations /

regions of India, revealed that samples from Punjab (65.5 per cent) qualified for Grade – II and III
of U.S, followed by Haryana (65.6 per cent) for grades III and IV. It was observed that most
limiting factor for Indian wheat was total defect as only 11.7 per cent samples could quality the
limit set for US Grade – I. Thus, it is evident that foreign matters, shrunken, broken and damaged
Kernels are not properly removed. Wheat Grading Equipment reduced the total defects to 2.25
per cent. Indian wheat can be classed on the basis of parameters like protein percentage,
sedimentation value (cc), hardness and score for end product.

Top

Clean Grains (High density) Medium Low

Density Density

¾ Indian Hard Wheat (IHW) for bread,

¾ Indian Medium Hard Wheat (IMHW) for chapatti and other products.
¾ Indian Soft Wheat (ISW) for biscuit.
¾ Indian Durum Wheat (IDUW) for pasta and traditional products.

Hence, development of product specific varieties and cultivation on product specific

locations are important, while planning in present market oriented agriculture. The varieties with
weak gluten and protein contents below 10 per cent are suitable for cakes and cookies, whereas
for chapaties, noodles and varieties wheat with medium protein (9 to 12 per cent) and gluten are
used. However, for Macaroni and white bread, high protein content (above 12 per cent) and
strong gluten strength are required.

Top
16
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Table No.5

Quality Variations of Wheat in Different Markets / States

SL. MANDI STATE ZONE WHEAT GRADE DATA TOTAL OTHER WHEAT
NO. DEFE- CLA- NON-GRADE
CTS SSES DATA
Hecto- Dama- Foreign Shrun- (%) (%) Mois- Pro-
litre ged Matter ken ture tein
weight Kernel (%) and (%) (%)
(kg./hl) (%) broken
(%)
1. 2. 3. 4. 5. 6. 7. 8. 9. 10 11. 12.
1. Almora Uttara- NWPZ 79.5 0.69 1.12 5.32 7.14 0.45 11.71 10.04
nchal
2. Pant- - do - - do - 77.7 2.87 1.27 1.27 8.30 0.35 11.78 11.09
nagar
3. Sangrur Punjab - do - 79.8 4.81 1.64 4.29 10.74 0.67 10.55 11.36
4. Khanna Punjab NWPZ 79.2 3.18 1.06 3.39 7.62 0.84 10.48 11.03
5. Sirsa Haryana - do - 77.8 3.15 1.03 5.45 9.63 1.47 9.39 11.47
6. Karnal - do - - do - 78.3 3.04 0.50 2.65 6.20 0.49 12.19 11.27
7. Kanpur U.P. NEPZ 79.2 0.55 1.67 7.66 9.89 0.89 13.14 11.04
8. Pusa Bihar - do - 76.8 1.97 0.92 4.01 6.90 0.06 9.35 11.38
9. Ujjain U.P. C.Z. 82.7 0.26 0.93 2.13 3.32 0.18 8.94 11.58
10. Dhar M.P. - do - 81.9 0.94 1.71 2.76 5.40 0.75 10.19 11.33
11. Kota Rajas- - do - 80.0 2.09 2.64 2.53 7.24 0.47 8.86 11.59
than
12. Jobener - do - - do - 81.7 3.54 0.22 4.63 8.38 0.31 9.86 11.14
13. Junagadh Gujarat - do - 82.5 1.42 0.73 2.79 4.94 0.05 11.23 12.31
14. Mehsana - do - - do - 81.7 0.63 0.58 6.99 8.19 0.20 10.21 12.19
15. Sangli Maha- PZ 81.2 1.46 0.63 3.84 5.93 0.23 10.69 12.07
rashtra
16. Niphad - do - PZ 80.2 1.15 1.35 3.22 5.71 0.14 10.70 12.58

SOURCE : Quality of Indian Wheat, Page No.91- 92.

3.4 Adulterants and Toxins :

Sources of contamination are soil, water, manure, equipments, transport vehicles and
storage conditions. Proper aerations and preventive care should be taken to minimize the
contamination.

Top

17
 Table No.6
Top

Adulterants in Wheat and their effect on health

Sl.No. Adulterants Health effects

1. Admixtures : Sand, Stones, Mud, Grit Adverse abrasive effect in
excess bran. digestive canal / tract
2. Chemicals : Heavy metal residues like Causes Liver damage and
Mercury, Copper, Tin, Zinc etc. and carcinogenic metal poisoning,
pesticide residues (beyond safe limit) paralysis.
3. Fungal Diseases : Toxins from Vomiting, diarrhea, paralysis,
Salmonella, Fusarium, Aspergillus Hill muscular weakness, damage to
bunt (Tilletia foetida), Karnal bunt liver, kidney and brain, leading to
(Neovassia India), Stem rust (Puccinia death.
graminis), Loose smut (Ustilago tritici)
4. Viral : Machupo virus; due to rodent’s Botivian hemmorrha gic fever.
urine
5. Natural contamination Disorder in body organs.

Some Simple Detection Tests for Wheat Top

Sl.No. Adulterants Detection Test

1. Sand, stone, By visual examination, by using Grading Machines like drum
grit in grains grader etc.
2. Hidden insect Put some grains on impregnated Ninhydrin (1 per cent in
infestation in alcohol) filter paper and fold the filter paper and crush the
grains grains with hammer. A spot of bluish purple colour indicates
presence of hidden insect infestation.

PFA had prescribed the tolerance limits (mg./1 kg. ppm) for pesticides residues and other
substances. Some of these are given below.

1. Pesticide Residue : Biterrtanol (0.05); Methyl chloro phenoxyacetic Acid

(MCPA 0.05); Aldrin dieldrin (0.01); Malathion (4.0);
Pyrethriuns (nil); Cypermethrin (0.05); Lindane or HCH
(0.10); Ethion (0.025); Carbafuran (0.10); Carbazyl (1.5).
2. Toxic Substance : Agaric acid (100); Hydrocyanic acid (5);
Hypericine (1); Saffrole (10).
3. Aflatoxin : (0.03)
4. Poisonous Metals : Methyl Mercury (0.25); Mercury (1.0); Lead (2.5);
Arsenic (1.1); Zinc (50.0); Cadmium (1.5).
5. Microbiological : Moulds (104/gm); B.cereus (105/gm); C.perfringens
Load (104/gm);
Top
18
 Top
Codex had also prescribed maximum pesticides residue in respect of wheat some are
Carbaryl (5 mg/kg.), 2040D (0.5), Eltephon (1)

A number of pesticides are banned / restricted in the west but are in use in agriculture in
our country. Some of these are – BHC; Carbofuron; Parquet; Monocrotophos; Methyl parathion;
Dimethoate etc.

World Health Organization (WHO) classified Monocrotophos as highly hazardous and

E.P.A. considers it highly toxic organophosphate 38 pesticide products have been banned for
use in agriculture by Government.

Other functionaries and Indian producers should be careful in selection and use of
chemicals for crop/produce protection so that it is acceptable in international market.

Toxins :

Aflatoxin : Aflatoxin are the type of mycotoxins, which occur due to fungi. These are produced
by Aspergillus flavour, Aspergillus ochnaceus and Aspergillus parasiticus. The contamination of
Aflatoxins occurs at any stage from field to storage, when the condition is conducive for fungus
growth.

Prevention and Control of Aflatoxins : Top

) Wheat should be stored at safe place away from moisture.

) Prevent the growth of fungi by proper drying of grains.
) Use proper and scientific storage method.
) Prevent insect infestation and fungus contamination by adopting
prophylactic / curative chemical treatment.
) Infested grain should be separated.

3.5. Packaging :
Packaging of food is the vital step to ensure longer shelf life and preservation of quality of
the product and provide protection against deterioration and damage during transport and
storage. Packaging is closely related to labeling and branding. Now-a-days consumer prefers
the product in unit packages. The manifold importance of packed food products lies in availability
of the wholesome, cleaned, unadulterated food items. More care is required in packaging of
wheat for export. In present age of consumerism, the package is not only the protector of the
contents but also attracts the consumer. Different trials have shown that wheat variety HD-2329
and HD-2285 treated with carboxin or captan respectively remained above Indian minimum seed
certification standard (1 MSCS) upto 20 months and 15 months, whereas untreated ones
become below 1 MSCS in 9 months. Polylined cloth bag and fungicide dressings enhance grain
longevity. For good packaging, the packages must posses following qualities.

¾ It must protect wheat in good condition and long lasting.

Top
19
 Top
¾ It must be clean and convenient to handle and carry out from the store
easily.
¾ It must be identifiable and attract consumers.
¾ It must resist spoiling.
¾ It must be informative about wheat i.e. name and address of the packer,
pack size, quality / grade, quantity, variety and date of packing etc.

Method of Packing

 The graded wheat should be packed in new, clean, sound and dry jute
bags, cloth bags, poly woven bag, polypropylene high molecular, high
density polyethylene or food grade packaging materials.
 The packages should be free from insect infestation, fungus
contamination and obnoxious smell.
 Each package should be securely closed.
 Each package should contain wheat of one grade only.
 The wheat should be packed in standard pack size as specified under
the provisions of Standards of Weights and Measures (packages
commodities) Rules, 1977 as amended from time to time.

Packaging Material Top

Recently, a policy decision has been taken by the Government of India to increase the
obligatory minimum use of jute bags from 60 per cent for food grains, under the provision of Jute
Packaging Materials (compulsory use in Packing Commodities) Act, 1987. Now, Govt. of India
has made it obligatory to pack entire food grains in jute bags only. The consumer packing of
cleaned wheat in 15 kgs. by retailers and super markets has also been made mandatory in jute
bags. (Economic Times, 19.10.2004)

The following packaging material is used :

) Jute bags
) HDPE / pp bags
) Polythene impregnated jute bags
) Cloth bags.

3.6 Transportation :
In the distribution of wheat, the means and cost of transport play an important role. The
cost of transport is the major factor responsible for the wide differences, which exist between
prices in surplus and deficit areas.

20 Top
 Top
The wheat is transported in bulk and bags from field to market. The following means of
transportation are used at different stages of marketing.

Means of Transportation Used at Different Stages of

Marketing

Stage of Transportation Means of Transport

Marketing is done by used

From threshing By head load, pack animal,

floor to the village / FARMER bullock cart or tractor trolley
primary market

From primary market

to secondary / By truck, railway
wholesale market Trader / Miller

From wholesale
market to retailer Retailer By truck, mini
truck, rail

By head load, pack

From retailer to animal, bullock carts,
consumer Consumer rickshaw, bicycle, two
wheeler

For export
Exporter / By ship, air
Trader cargo, truck
21

Top
 Top
The road and rail transport is generally used for internal markets, whereas for export
purpose – waterways are generally used. However, roadways is also used for transport to
neighbouring countries connected by road.

The following means of transport are employed in different parts of the country to
transport wheat.

a) Head Load b) Bullock carts

Animal Load

c) Tractor trolley d) Truck

Top

Railways : This is most important and

cheapest mode of transport for wheat. It is
suitable for long distance and for larger quantity.
It needs more handling charges as it requires
loading and unloading and local transport cost.

Top
22
 Top

Water / Sea transport : This is one of the oldest and cheapest modes of transport near or
on the bank of river, canals or costal areas. This transport is a little bilt slow but cheap and useful
for carrying large quantity. Export of wheat is done mostly by ship through sea.

The following points should be considered for selection of mode of transport.

) It shall be cheaper amongst available alternatives.

) It shall protect wheat from adverse weather condition.
) It shall be insured.
) The delivery shall be made in time to the consignee.
) It shall be producer friendly for the payment of transportation.

3.7 Storage: Top

Wheat is main staple food for majority population, hence stored from one season to the
other. The shrinkage of cultivable land compounded by exponential growth in population
compels to evolve better storage facilities so as to reduce the losses to the minimum. Further,
storage facilitates better price realization (+ 25 per cent) by extending marketing duration.
Table No.7
Factors Influencing Storage Loss

Sl.No. Factors
1. 2.
1. Moisture
2. Temperature
3. Insects, rodents
4. Quality before storing the grain
5. Types of bin, storage containers,
6. Sanitation
7. Use of pesticide and fumigants
23

Top
 Top

1. 2.
8. Type of damage before storing the grain like frass and webbing,
exit holes, darkened kernels and degermed kernels.
9. Mechanical factors.
10. General condition, location of storage.

Harvested grains normally contain 20 per cent moisture content whereas for storage,
around 12 per cent moisture is recommended. The drying is achieved by natural or mechanical
resource. Moisture content more than 13 per cent at temperatures 30 to 400 C make wheat
susceptible to moulds causing musty odour, discolouration and lower flour yield.

Equilibrium moisture content for wheat is 13.5 per cent at 70 per cent RH (relative
humidity). For short duration, storage moisture content of desired is 13 to 14 per cent is
tolerable, whereas for longer duration storage upto 5 years, it should be 11 to 12 per cent.

3.7.1 Major Stored Grain Pests and their Control Measures :

In India, farmers retain about 50 to 60 per cent of the grains for food, cattle feed and seed
purposes. The farmers generally store their grain in simple grainaries constructed from locally
available materials like paddy straw, split bamboo, reeds, mud and bricks. Because of
favourable and conducive atmosphere, the breeding of insects, micro-organism and rodents
causes heavy losses to the foodgrains quantitatively and qualitatively. It also damages seed
viability and storage structures. Stored grains are lost or damaged by a number of causal agents
viz.,
Top
Birds : Birds proofing can be achieved by placing wire screens on openings like
ventilators, windows and doors.
Rodents : Storage building can be made rodent proof by concrete floors and metal
shields around wooden doors.
Insects : About 13 species of insects damage the stored
wheat. 2 species of weevil, attack whole kernel.
Rice weevil is dominant pest causing grain
damage to the tune of 2-5 per cent. Whereas,
beetles and larvae of moths attack grains or
broken kernels.
Fungi : It causes maximum losses in stored grain. The humidity in grain or storage
is conducive for fungal attack and makes the grain “Sick Wheat”

Pests and fungal infestation can be controlled by – (A) Prophylactic Measures and
(B) Curative Treatments

A) Prophylactic Measures – Preventive measures consist of cleanliness of grains and

store houses and by treating the godowns @ 3 litres per square meter area by chemicals
like:
> Malathion (50 per cent EC) – Mix 1litre malathion in 100 litres of water, spray
it every 15 days.
24
Top
 Top
> DDVP (76 per cent EC) – Mix one litre in 150 litres of water. Spray walls and
floors, as and when required. Avoid spray on stocks.
> Deltamethrin (2.5/wp) – Mix 1kg in 25 litres of water. Spray on walls and floor.
B) Curative Treatments – Use of chemicals in air tight condition on infested stocks.
> Alluminium phosphide – Use 3 tablets per tonne or 120 – 140 tablets per
100 cubic meter area and cover the stocks with polythene for 7 days.
Table No.8
Important Wheat Pests, Damage Caused and Control Measures

Sl. Name of pest Figure of pest Damage Control measure

No.
1. 2. 3. 4. 5.
1. Grain Weevil Larvae and beetles feed Malathion, DDVP,
Sitophilus on grains. Adults feed on Deltamethrin,
granarius (L.) flour, mass infestation Fumigation with
(Calandra makes grain moist and Phostoxin or
granaria (L.) warm leading to mould Magtoxin
infection.

2. Lesser rice Adults and larvae feed on

Weevil / grains and flour. Larvae
Sitophilus bore into grains and feed - do -
oryzea (L)/ on the grain.
Greater Rice
Weevil
S.Zeamais
(Motsch)
3. Lesser grain Beetles and larvae bore
borer the grains and feed. The
Rhizopertha larvae feed on flour. - do -
dominica (Fabr.) Heavy infestation makes
the grain warm and moist,
which leads to mould
formation

4. Khapra beetle The larva is a very serious

Trogoderma stored product pest, the
granarium Ev. beetle does no damage. - do -
The grains are often
hallowed out until only the
husk remains.

Top
25
 Top
1. 2. 3. 4. 5.
5. Rust-red and Beetles and larvae feed on Malathion,
confused flour undamaged and broken DDVP,
beetle kernel, common mill pest, flour Deltamethrin,
Cryptolestes develops sharp odour if badly Fumigation with
ferrugineus infested. Phostoxin or
(Steph.) / Magtoxin
Tribolium
Confusum J.Du V.
6. Drugstore beetle The larva is omnivorous, feeds
Stegobium on a wide range of plant
paniceum (L.) materials and grain. The - do -
badly infested grains are full of
small round holes.

7. Saw Toothed grain Both beetle and larvae feed on

beetle broken grains and attack
Oryzaephilus grains, already infested by - do -
surinamensis (L.) other insects. It is a secondary
pest together with other grain
pests.

8. Cadelle It damages grains.

Tenebroides
mauritanicus (L.) - do -

9. Angoumois grain It attacks in field also, but

moth mostly in storage, causing loss
Sitotroga of weight upto 50 per cent. - do -
cerealella (Oliv.) Badly infested grain has a
sickening smell and taste that
makes it unpalatable.

10. Mediterranean The caterpillars feeds on flour,

Flour Moth bran, whole grains. - do -
Ephestia
(Anagasta)
kuehniella Zell.

26

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 Top

1. 2. 3. 4. 5.
11. Warehouse The caterpillars Malathion, DDVP,
Moth attacks grain. Deltamethrin,
Ephestia Fumigation with
elutella (Hubn.) Phostoxin or Magtoxin

12. Indian Meal Attacks grain and

Moth grain products, - do -
Plodia whereby only the
interpunctella grain germs are
(Hubn.) eaten.

13. Rodents Rodents feed on Rat Cage – By using

Rattus whole and broken different types of cages.
norvegiens grains, flour etc. Cakes/Baits anti-
(Brown rat), They spoil more coagulants, like zinc
R.Rattus Rattus wheat than they eat phosphide are mixed with
(Black rat) , by contaminating it bread or any other food
Bandicota with hair, urine and used as bait.
bengalensis faeces. Rat burrow fumigation –
(Indian mole Put aluminium phosphide
rat), Mus tablets in each hole/
musculus burrow and block the hole
(House mouse) by mud to air tight.

3.7.2 Storage Structures :

In villages, foodgrains are stored in traditional structures of the different shape and size
with capacity varying from 2 to 5 tonnes.

a) Underground storage structures – Underground storage is common in dry parts

of Karnataka, Uttar Pradesh, Bihar, Madhya Pradesh, Maharashtra and Andhra
Pradesh. The depletion of oxygen in the underground storage structures
discourages infestation but seepage of moisture results in mould growth and grain
damage by rodent is possible.
b) Above ground storage – This can be classified into indoor and outdoor storage
structures. These are again classified as a) Traditional Storage Structures, which
include, mud bin, bamboo-reed bin, the metal drum, gunny bags, petta b)
Improved storage structures, which include improved bin, brick build godowns,
cement plastered, bamboo bin, CAP (Cover and Plinth) storage and silos.

27
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 Top
Bags of 100 kg. capacity are used. The bags are susceptible to
moisture, temperature, insect, rodent and microbial spoilage. The bags
can be made moisture proof, partially resistant to temperature by giving a
lining of polyethylene, painting both inside and out side, with paints to
close the pores and also to reflect heat.

The petta and bamboo bins can be made impermeable to moisture by plastering both
inside and outside with paper pulp mixed with 2 per cent methi (fenugreek). As per experiments
conducted by FCI, such storages can save grains upto six years. Rodent proofing of the
traditional structures is done by skirting them to height of 2 feet from ground with metal sheets or
treated jute bags, which are brushed periodically or sprayed with a rat repellent like malathion.
Bamboo cages, which are also coated with bitumen 10 to 20 and the cage is covered with cast in
clay rings to make it moisture, insect and rodent resistant.

CFTRI in collaboration with Central Building Research Institute, Roorkee have

experimented for improvement of clay bins, wherein they have suggested that before casting of
the bins with the mud puddle, a bituminous mixture to be added @ 2 kgs. / cft. of dried soil. The
bitumen was heated to 100o C with creosote oil prior to mixing with clay material. Another
findings was that the periphery of rings were coated with 10 to 2- bitumen to arrest moisture and
rings were arranged one above the other on the basement and the junctions were sealed well
with wet clay.

Metallic Storage Structures :

Top
The dehydro bin of GI metal of half tonnes capacity was fabricated with dome shaped
cover with channel at the periphery to run down the collected water.

New Rural Storage Structures :

CFTRI multipurpose knock-down structures – Multipurpose knock down structures using
GI sheet and wooden reaper frames was developed. The comparative ease of fabrication,
transportation and erection of structures and its high degree efficiency in performance was
established.

3.7.3 Storage Facilities :

i) Producers Storage Facilities – Wheat is stored in traditional as well as improved

structures of different shapes and sizes of 2 to 5 tonnes for one year.

Code of Practices for Safe Storage of Grain at Farmers’ Level

) As far as possible, clean the grain prior to storage.

) Dry the grain either in the sun or by the dryer till the moisture is down
to a safe limit. (12 to 14 per cent depending upon period of storage)
) Clean the storage structure and disinfect it before filling up the grain.

28
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 Top
) Fill the structure upto capacity carefully always from the top.
) Stir grain with large stick so that grain settles.
) Add recommended doses of pesticides into the grain before closing the
cover of the structure.
) Close inlet and outlet covers immediately.
) Put mud or other binding materials as the case may be on cracks and
crevices. This would not allow the weevils and pests to enter the grain
or structure to cause damage.
) Area around the structure must be cleaned to discourage rats.
) Spilled grain around structure should be removed.
) Sweep out all debris, dust, grains etc. and disinfect the structure, after
emptying.
) It is always desirable to consult the local agencies regarding use of
chemicals and improved techniques for grain storage.

ii) Rural Godowns – At rural level, farmers store the produce in their own houses and by
using different structures. It is a known fact that the marginal and small farmers are not
economically sound to retain their produce till the market prices are favourable for sale.
Considering the importance of rural storage in marketing of agricultural produce, the
Directorate of Marketing and Inspection (DMI), an attached organization of Ministry of
Agriculture, Government of India initiated a Rural Godown Scheme in collaboration with
NABARD and NCDC to construct Rural Godowns.
Top
Gramin Bhandaran Yojna - The produce is stored by a scientific method so that the
wastage and deterioration of grain are avoided. It helps the farmers to meet the credit
requirement without being compelled to sell the produce at a time, when the prices are
low.

The construction of 2373 godowns were sanctioned through NABARD and NCDC with the
total capacity of 36.62 lakh tonnes upto 31.12.2002. In addition, 973 godowns with
storage capacity of 0.956 lakh tonnes were sanctioned under renovation and expansion.
The main objectives of the Rural Godown Scheme are as under :

¾ To prevent distress sale of food grains and other agricultural

produce immediately after harvest.
¾ To reduce quantitative and qualitative losses due to storing of
food grains in substandard storage.
¾ To reduce pressure on transport system in the post harvest
periods of peak supply.
¾ To help the farmers in getting pledge loans against their stored
produce to meet immediate financial requirement.
Top
29
 Table No.9
Top

Rural Godowns Capacity in M.T. in different States

Sl.No. State M.T. Sl.No. State M.T.

1. Chhatisgarh 206298 7. Punjab 157600.0
2. Gujarat 104312.98 8. Rajasthan 32500
3. Haryana 1083995 9. Tamil Nadu 20618
4. Karnataka 257993 1. Uttar Pradesh 526902
5. Kerala 11059 11. West Bengal 131206.27
6. Maharashtra 122136.2

SOURCE : Sub-offices of DMI.

iii) Mandi Godowns – The farmers after harvest transport their produce to the mandis. It
is transported in bulk or in bags, but mostly in bags. Most of the states and U.T. have
enacted the Agricultural Produce Marketing Regulation Acts. The Agricultural Produce
Market Committees have constructed their godowns in the market. In the same yard,
private traders, CWC, SWC and Co-operatives Societies were also allowed to construct
the godowns. At the time of storing the produce in the godown, a receipt is issued
indicating the quality and weight of the produce stored. That receipt can be treated as
negotiable instrument and eligible for pledge finance.

The State-wise Storage Capacity at Mandi Level is given in the table.

Table No. 10 Top

SL.NO. STATE M.T. SL.NO. STATE M.T.

1. Bihar 14300 7. Maharashtra 4825
2. Chattisgarh 41900 8. Orissa 1840
3. Gujarat 80000 9. Punjab 21614000
4. Haryana 129500 10. Uttaranchal 39945
5. Karnataka 14000 11. Uttar Pradesh 10800
6. Madhya Pradesh 29900 12. West Bengal 28376

SOURCE : Sub-offices of Directorate.

iv) FCI, CWC and SWC Warehouses :

a) Central Warehousing Corporation (CWC) – Central Warehousing

Corporation was established during 1957. It is the largest public warehousing
operator in the country. The CWC is having 475 warehouses in 16 regions covering
225 districts of country (March, 2002). The total capacity under different heads is
as follows:

30 Top
 Top
Table No. 11
Head Capacity (Lakh M.Tonnes)
Constructed 58.89
Hired 17.33
Open 12.75
Total : 89.17
SOURCE : Annual Report 2000 – 2001
Central Warehousing Corporation, New Delhi.
As per the Ministry of Food, Govt. of India, the CWC constructed additional storage capacities of
3.59 (2002-03) and 3.11 lakh tonnes (2003-04).

The godowns are used for storage of food grains, fertilizers, etc. 40.88 Lakh metric tonnes
capacity was used for storage of foodgrains. The increase in capacity was by 5.26 Lakh tonnes,
whereas the storage of food grains showed an increase of 6.84 Lakh tonnes over previous year
(2001). Apart from storage, CWC also offers services in the area of clearing and forwarding,
handling and transportation, distribution, disinfestations, fumigation and other ancillary activities.
The CWC has also introduced scheme, called the Farmers Extension Services at selected
centres to educate farmers about the benefits of scientific storage.
Table No. 12
Top
State-wise Storage Capacity with CWC as on 31.03.2003
Sl. No. Name of State Number Total Capacity (in tonnes)
1. Andhra Pradesh 49 1259450
2. Assam 6 46934
3. Bihar 13 104524
4. Chhattisgarh 10 259964
5. Delhi 11 135517
6. Gujarat 30 515301
7. Haryana 23 338860
8. Karnataka 36 436893
9. Kerala 7 93599
10. Madhya Pradesh 31 665873
11. Maharashtra 52 1248510
12. Orissa 10 150906
13. Punjab 31 820604
14. Rajasthan 26 371013
15. Tamil Nadu 27 676411
16. Uttaranchal 7 73490
17. Uttar Pradesh 50 1018821
18. West Bengal 43 563698
Others 13 136826
Total 475 8917194
SOURCE : Annual Report 2001 – 2002,
Central Warehousing Corporation, New Delhi.
31
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 Top
b) State Warehousing Corporation (SWC) – Different states have set up
their own warehouses. The area of operation of SWC is mostly at district places of
the state. Central Warehousing Corporation holds 50 per cent share in the equity of
17 SWCs all over the country. The SWCs are under the dual control of Central
Warehouse Corporation and concerned State Government. As on 31.12.2002,
these SWCs were operating a network of 1597 warehouses with an aggregate
capacity of 201.90 lakh M.T as per details given below :

Table No. 13
State-wise Storage Capacity with SWCs as on 31.12.2002

Sl. Name of State No. Total Capacity

No. (in Lakh tonnes)
1. Andhra Pradesh 120 17.14
2. Assam 44 2.67
3. Bihar 44 2.29
4. Chattisgarh 95 6.66
5. Gujarat 50 1.43
6. Haryana 113 20.48
7. Karntaka 107 6.67
8. Kerala 62 1.85 Top
9. Madhya Pradesh 219 11.57
10. Maharashtra 157 10.32
11. Meghalaya 5 0.11
12. Orissa 52 2.30
13. Punjab 115 72.03
14. Rajasthan 87 7.04
15. Tamil Nadu 67 6.34
16. Uttar Pradesh 168 30.42
17. West Bengal 32 2.58
Total 95 201.90

SOURCE : Central Warehousing Corporation, New Delhi.

SWCs constructed additional godowns and raised the capacity to 215.84 lakh
tonnes in 2003-04 (Ministry of Food, Govt. of India)

c) In Punjab State the Punjab Agro-Food Grains Corporation (PAFC) (20.23), Punjab
State Warehousing Corporation (PSWC) (38.28), Markfed (52.46), Pungrain
(Foodsep-16.09), Puncap (32.00) jointly have storage facilities for 159.06 lakh
tonnes, inclusive of open storage area.

32 Top
 Top
d) Food Corporation of India (FCI) – The storage capacity for foodgrains
available with Food Corporation of India as on 31st March, 1999 was 23341.14
thousand tonnes (covered 19155.97 and open 4185.17 thousand tonnes). Out of
this, 14133.31 thousand tonnes was its own, whereas 9207.83 thousand tonnes
capacity storage was hired. As on 31.03.2002 the FCI was having godowns with
the capacities of 279.01 lakh metric tonnes. The break-up was 127.41 owned and
151.60 lakh metric tonnes hired. The FCI also constructed additional storage
facilities of 0.94 in 2002-03 and 1.32 lakh tonnes in 2003-04.

v) Cooperatives Storage Facilities :

National Cooperative Development Corporation (NCDC) is constantly striving to assist
cooperatives in creating additional storage capacities for expanded operations of marketing and
distribution of inputs, sale of consumer articles. As on 31.03.2001, the storage capacity of
cooperatives was 137.63 lakh tonnes. The cooperative storage is assisted by different schemes
as given here under :

1. Centrally Sponsored Schemes : As on 31.03.2001, 15146 rural and 2584

marketing godowns with a capacity of 27.06 lakh tonnes were sanctioned to
comparatively least / under developed states / U.Ts. An amount of Rs.4996.70
lakh was released for the purpose. The organization is also providing 70 per cent
loan, 20 per cent subsidy for site preparation, hardware and system and application
software the period of loan is 8 years. Assistance is provided for new, repair and
maintenance of storage and cold storages.
Top
2. NCDC Sponsored Scheme : As on 31.03.2001, 41378 rural and 6989
marketing godowns with 113.12 lakh tonnes capacity were sanctioned to the
states, which have developed cooperative system.

3. Internationally Aided Projects : NCDC is also involved in rural godown

projects with the assistance of IDA and EEC. Such projects are being implemented
in states of Madhya Pradesh, Rajasthan and Bihar. Under these projects,
construction of 23,.800 rural godowns and 3441 marketing godowns were
sanctioned. The total capacity envisaged was 73.0.73 lakh tonnes.
4. European Economic Countries (EEC) Assisted Rural Growth
Centre Project (Bihar) : The project – EEC Rural Growth Centres in Bihar
commenced in March, 1988 for a period of 8 years i.e. upto March 1996. During
this period, assistance for construction of 1500 godowns of 100 Metric Tonnes
each was approved at a total cost of Rs.3330.00 lakhs and an assistance of
Rs.2832 lakhs sanctioned/ released to State Govt. of Bihar.

Top

33
 Top
Table No.14
State-wise Cooperative Storage Facilities as on 31.03.2001
Sl. Name of State Rural Market Total Capacity
No. Level Level (in tonnes)
1. Andhra Pradesh 4003 571 690470
2. Assam 770 262 297900
3. Bihar 2455 496 557600
4. Gujarat 1815 401 372100
5. Haryana 1454 376 693960
6. Himachal Pradesh 1634 203 202050
7. Karnataka 4828 921 941660
8. Kerala 1943 131 319585
9. Madhya Pradesh 5166 878 1106060
10. Maharashtra 3852 1488 1950920
11. Orissa 1951 595 486780
12. Punjab 3884 830 1986690
13. Rajasthan 4308 378 496120
14. Tamil Nadu 4757 409 956578
15. Uttar Pradesh 9244 762 1913450
16. West Bengal 2791 469 478560
17. Other States 1031 256 312980
Total 55889 9426 13763463
Top
SOURCE : Annual Report, 2000-2001,
National Cooperative Development Corporation, New Delhi.

3.7.4 Pledge Finance System :

Micro level studies indicate that about 54 per cent of marketable surplus was generated
by small and marginal farmers. Non-availability of adequate storage facilities coupled with
immediate need of money compel the farmers to sell the surplus wheat immediately after
harvest. Pledge finance is crucial as it enables producer to hold an inventory of graded produce
under favourable storage conditions without selling it during the glut period.

According to NABARD, the pledge financing is to the tune of about Rs.1200 crores at
present, whereas estimated requirement is Rs.7000 crores by the end of Xth Five Year Plan. At
present, Commercial and Co-operative Banks are providing limited credit for marketing of crops
as their emphasis is on providing credit for crop production. As per Reserve Bank of India
guidelines, the finance against pledge / hypothecation should be provided to the extent of 75 per
cent of the value of stored produce, subject to maximum limit of Rs. 1 lakh. The credit is

34 Top
 Top
provided for a period not exceeding six months with some stipulated terms and conditions.
However, there is no bar for extending pledge finance for a period of 12 months. There is no
margin for credit upto Rs.10,000/-, whereas the margins are decided by the individual banks in
case advance is above Rs.10,000/-

In some states, District Central Co-operative Banks (DCCBs) are directly financing
individual farmers on the basis of pledge. In states like – Andhra Pradesh, Tamil Nadu, Bihar,
Uttar Pradesh, Rajasthan and Haryana, the scheme of pledge finance is being operated by the
Market Committees (APMCs). The pledge finance scheme for agricultural produce provided by
the Agricultural Produce Market Committees in different states is given in Table No.15.

Benefits of the Pledge Finance

 Prevent distress sale by producers.
 Promotes cleaning, drying and grading at farm gate.
 Promotes proper storage facilities.
 Facilities better price realization by farmers.
 Avoids glut conditions in market.

Table No.15 Top

Pledge Finance of Agricultural Produce – Grant of Advance by the
Market Committees in different States / U.T(s)
Sl.No. Name of the Details of Pledge finance advance to Producers
State/Union
Territory
1. 2. 3.
1. Andhra A Scheme under Andhra Pradesh (Agril.Produce & Live Stock)
Pradesh Markets Act, 1966 provides advances against pledge to the
producers. The advance is given to the extent of 75 per cent of the
value of the produce pledged with the Market Committee subject to
maximum limit of Rs.10,000/-. The pledge stocks may be sold
within 90 days. The advance is free of interest for the first 30 days.
Interest @ 6 per cent per annum shall be charged from the 31st day
till the date of disposal. The market committee shall not charge
any godown rent for the first 7 days. From the 8th day, the charges
shall be as prescribed in bvye-laws subject to a maximum of 90
days.
2. Tamil Nadu The scheme for providing short term advance to small farmers,
marginal farmers and other farmers against Pledge of Agricultural
Produce is being implemented in the State. For small and
marginal farmers, the loan amount may be 75 per cent of the
produce value subject to a maximum of Rs.10,000/- and for “other
farmers”, the loan amount may be 50 per cent of the produce
value, subject to the maximum ceiling of Rs.10,000/-. The
advantage is provided for a maximum period of 6 months – First

35
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 Top
1. 2. 3.
2. Tamil month shall be interest free and for the remaining 5 months, simple
Nadu interest at the rate of 12 per cent per annum shall be charged
uniformly. The amount ear-marked to short term advance to each Rural
Godown is Rs.5,00,000/- (Rupees Five Lakhs only)
3. Uttar A scheme of pledge-finance is being operated through Market
Pradesh Committees. According to the scheme, advance is given to the extent
of 75 per cent of the value of the produce pledged with the market
committee subject to maximum limit of Rs.5000/- and Rs.2500/- to small
and marginal farmers respectively. The advance shall be free of
interest for the first 30 days. Interest 6 per cent per annum shall be
charged from 31st day till the date of disposal. The Market Committee
shall not charge any godown rent for the first 7 days. From the 8th day,
the charges shall be 10 paise per bag per month or part thereof. The
pledged stocks may be sold in 90 days.
4. Karnataka The Government of Karnataka has made a new provision in K.A.P.M. R
Act, 1966 to-
Provide short-term advances as may be prescribed to producer-
sellers in the market area on pledge of notified agricultural produce
in favour of the market committee. The above provision came into
force on 17.06.1986. However, the scheme for granting and regulating
advances is not yet in operation, for want of separate Rules. The
scheme of providing transport facility is in operation in the Karnataka
State. Only transportation charges are being collected from
producers on no profit no loss basis by the Market Committee in
providing transport facility.
5. Bihar The scheme for providing short term advance to small and marginal
farmers against pledge of Agricultural Produce in Insured Godown of
the Market Committee is being implemented in the State. Market
Committees give short term advances through State Bank of India at 60
per cent of the value of the produce stored upto a maximum of Rs.5000
per individual. The advance is provided for a period of 180 days.
Interest @ 13.5 per cent shall be charged. The market committee
reserves the right to sell the pledged produce after 180 days through
open auction.
6. Rajasthan The advance to the extent of 60 per cent of the value of the produce
pledged with the Krishi Upaj Mandi Samities may be paid subject to a
maximum limit of Rs.15000/-. The advance shall attract concessional
rate of interest of 9 per cent for the first 60 days and 12 per cent for the
next 90 days. Maximum duration of storage allowable under pledge
scheme will be of 150 days (5 months). The pledger will be liable to pay
the warehousing charges for the period his goods are stored in the
godowns. The Krishi Upaj Mandi Samities will have the right to sell the
produce after five months from the date of storage of the stocks and
thereafter through open auction. The Government of Rajasthan also
operate schemes for ‘Pay-back’, fee collection to small and marginal
farmers and for free transport facility to small and marginal farmers for
agricultural produce.

36 Top
 Top
1. 2. 3.
7. Haryana The Scheme regarding pledge of agril. produce is being implemented
by Haryana Government through Central Bank of India and Punjab
National Bank. The Government is also thinking to associate the
Cooperative Banks for granting advances to the farmers against
Warehouse receipts of Haryana Warehousing Corporation. The
Haryana State Agril.Marketing Board is not directly participating in the
scheme.
8. Punjab As regards schemes for granting loan, to the farmers against their
produce, the matter has been linked up with the mechanization of
mandi operations. The scheme for partial mechanization of mandi
operation is in vogue in 8 mandies on pilot project basis. Its extension
alongwith provision of storage facility and grant of loans against such
storage will depend upon successful operation of mechanization
programme.

4.0 MARKETING PRACTICES AND CONSTRAINSTS :

The wheat is notified commodity and most of the sales by farmers are conducted in
various regulated markets. However, under Market Intervention Scheme (MIS), Food
Corporation of India and other organizations procure wheat directly from producers at their
collection centres. The wheat procured in major producing states during the years is given here
under.
Table No. 16 Top
Procurement of Wheat in Major Producing States
(Lakh tonnes)
Sl. State 1991 - 1995 - 1999 - 2000 - 2001 - 2002 -
No. 1992 1996 2000 2001 2002 2003
1. Punjab 55.43 72.99 78.31 94.24 105.60 98.63
2. Uttar Pradesh 3.68 13.02 12.61 15.45 24.46 21.11
3. Haryana 18.34 31.02 38.70 44.98 64.07 58.88
4. Rajasthan 0.08 4.54 6.37 5.39 6.76 4.61
5. Others 0.00 1.70 5.44 3.50 5.41 7.02
All India 77.53 123.27 141.43 163.56 206.30 190.25

SOURCE : Deptt. Of Agriculture and Cooperation, Ministry of Agriculture, Govt.of

India.

The stock of wheat possessed by central and state agency was 12.69 million tonnes on
st
1 January, 2004. The maximum wheat storage was 32.41 million tonnes in the year 2002.

Top
37
 Top
4.1 Important Markets :
Since wheat is an important food item, its transactions take place in most of the markets
of country. Important wheat markets are listed in the following table;
Table No. 17
Important Markets of Wheat in India

Sl. State Number Name of markets

No.
1. Bihar 13 Patna City, Bihta, Ara, Buxar, Goplaganj,
Mothihari, chalia, Chhapra, Maharajganj,
Nirmati, Tribeniganj, Munger, Raxaul.
2. Chattisgarh 20 Ambikapur, Vaikunthpur, Raipur, Durg,
Bilaspur, Kanker, Surajpur, Dogragadh,
Rajnandgaon, Sarguja, Koriya.
3. Uttar Pradesh 16 Puwayan, Etah, Barreilly, Shahjahnapur,
Hardoi, Bulandshahar, Pilibhit, Varanasi,
Gorakhpur, Kanpur, Agra.
4. Haryana 19 Ambala, Panchkula, Yamunanagar,
Karnal, Panipat.
5. Karnataka 58 Bangalore, Belgaum, Bijapur, Dharwad,
Gadag.
6. Punjab 144 Ajnala, Amritsar, Bhikiwind, Khanna,
7. Madhya Pradesh 5 Ujjain, Guna, Gwalior, Sehore, Sagar
8. Maharashtra 20 Pune, Kalyan, Solapur, Ulhasnagar,
Dhule, Kolhapur, Nagpur, Nadurbar,
Ahmednagar,
9. Gujarat 33 Ider, Kapadganj, Nadiad, Modasa,
Himatnagar, Barala, Palanpur, Dhanera,
Mehsana
10. Meghalaya 1 Phulbari
11. Rajasthan 11 Kota, Alwar, Jaipur, Sriganganagar,
Dausa, Hanumangarh, Sikar, Baran,
Bundi, Bharatpur.
12. Uttaranchal 12 Kashipur, Kiccha, Khaima, Sitarganj,
Gadarpur
13. West Bengal 68 Jhant Pakari, Simlapal, Katulpur,
Bishnupur, Ahmednagar, Belapur,
Dubrajpur
14. Delhi (NCT) 2 Narela, Nazafgarh.
All India 444
SOURCE : Important Markets of Major Agricultural Commodities in India.
( MRPC Report No.32, 2000 of DMI).
38
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In the North-East Region wheat is transacted in 9 markets of Arunachal Pradesh,
7 markets of Assam, 8 markets of Manipur and 14 markets of Tripura. Most of the transactions
of wheat take place in 3 markets of Goa.

4.1.1 Arrivals in Major Wheat Producing States :

Haryana , Uttar Pradesh and Bihar are the major states for
wheat arrivals followed by Madhya Pradesh and Punjab. It is evident
from the following table that there were vast fluctuations in quantity of
arrivals during 1999-2000 to 2001-2002, as may be seen in the
following table.
Table No. 18
Arrivals of Wheat in Markets of Major Producing States During 1999 to 2002
(Qty. in qtls.)
Sl.No. Name of the State YEAR
1999 – 2000 2000 – 2001 2001 – 2002
1. Haryana 3947470 4593091 7574231
2. Uttar Pradesh 1556179 1789734 1810198
Top
3. Bihar 1237230 1451383 1081550
4. Madhya Pradesh 1164824 1377355 9061322
5. Punjab 793000 9698000 10579000
6 Rajasthan 789329 1037531 923467
7. Uttaranchal 308629 282312 320866
8. Maharashtra 283393 194678 N.A
9. Karnataka 16488 33743 54569
10. Jharkhand 21919 20596 10969
11. Delhi 160390 315260 86330
SOURCE : Director General of Commercial Intelligence and Statistics (DGCIS),
Kolkata
The markets arrivals in some of major markets have been depicted in the following table.
Table No. 19
Market Arrivals in Selected Major Markets of some of the States
Sl. State Markets Year (Arrivals)
No. 1999 – 2000 2000 – 2001 2001 – 2002
1. 2. 3. 4. 5. 6.
1. Haryana 1. Ambala 105624 141942 1566458
2. Sirsa 627692 742938 829830
3. Karnal 427371 536989 688674
4. Kaithal 420668 571533 667998
39
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 Top
1. 2. 3. 4. 5. 6.
2. Uttar Pradesh 1. Varanasi 420079 354600 353094
2. Sahajahanpur 152612 198239 197548
3. Gorakhpur 197839 158968 176001
4. Powayan 152139 186181 173986
3. Bihar 1. Sasaram 10091 15250 14110
2. Hilsa 18100 19000 9426
3. Muzaffarpur 56455 48457 27701
4. Gulabbagh 8757 35526 36130
4. Madhya 1. Itarsi 39412 98871 100773
Pradesh 2. Harda 20998 75576 64694
3. Indore 84827 101207 59244
4. Tikamgarh 36679 63485 58685
5. Punjab 1. Sangrur 1037000 1208000 137000
2. Ferozpur 1198000 1240000 1291000
3. Amritsar 830000 1030000 1184000
4. Ludhiana 598000 741000 886000
6. Rajasthan 1. Hanumangarh 133310 164353 151477
2. Kota 174766 252742 233305
3. Bundi 63042 87073 99323
4. Sriganganagar 92879 112738 80399
7. Delhi 1. APMC Najafgarh 8979 15485 8141
2. APMC Narela 7861 15930 152
3. Panadara NA 111 340
8. Uttaranchal 1. Kashipur 83516 79665 75210
2. Kichha 47347 27015 46270
3. Khatima 38256 32877 41256
4. Sitarganj 36039 35993 36432
9. Maharashtra 1. Pune 81508 77296 -
2. Sholapur 37094 25531 -
3. Jalna 11807 18525 -
10. Karnataka 1. Bangalore - 10967 34699
2. Naragund 864 5281 6740
11. Orissa 1. Dunguripali 9866 10159 15315
2. Panposh 7652 7132 8256
12. West Bengal 1. Samsi 700 800 900
2. Lalbagh 600 400 700
SOURCE : (DGCIS), Kolkata

Top
40
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In Uttar Pradesh, there were 232 daily regular sale centres and 27 weekly centres. 6
each secondary and primary markets. Karnataka state had 7 markets for wheat, except
Bangalore (Urban), which is a terminal market. Others were primary regulated markets. In Kerala
and Goa, there were no regulated markets for wheat. In Assam, wheat was transacted in 48
markets.

4.1.2 Despatches :
Most of the markets were not maintaining the record of despatches of wheat destination-
wise. In most of the states, the despatches were mostly to other markets of district or
neighbouring. Detailed interstate despatches are given in Table No. 21.

Wheat from surplus states like Haryana, Punjab and Uttar Pradesh was despatched to
other states. Few markets like Powayan, Shahjahanpur, Bareilly, Pilibhit and Kanpur of Uttar
Pradesh despatched the wheat to Assam, West Bengal, Bihar, Delhi and Gujarat States. West
Bengal though received wheat from Uttar Pradesh and Gujarat, it caters to the need of North
Eastern Region (NER). In Assam, out of total 48 markets, which received wheat, 35 markets
despatched the wheat to intra-state and inter-state markets of North Eastern Region.

Inter-state despatches from major wheat producing states is given below.

Table No.20 Top
Despatches of Wheat from One State to other States
Sl.No. Feeder State Receiving States
1. Punjab Andhra Pradesh, Bihar, Delhi, Gujarat, Karnataka, Kerala,
2. Haryana Maharashtra, Orissa, Rajasthan, Tamil Nadu, West Bengal.
3. Uttar Pradesh Andhra Pradesh, Gujarat, Karnataka, Kerala, Maharashtra,
Orissa, Punjab, Rajasthan, Tamil Nadu, West Bengal, North
Eastern Region.
4. West Bengal Bihar, Gujarat, Orissa, Uttar Pradesh, Punjab, Delhi, North
Eastern Region.
5. Delhi Andhra Pradesh, Karnataka, Gujarat, Kerala, Maharashtra,
Orissa, Tamil Nadu, North Eastern Region.
6. Madhya Pradesh Andhra Pradesh, Bihar, Kerala, Tamil Nadu, Delhi.

SOURCE : (DGCIS), Kolkata

4.2 Distribution :

Producers bring the produce to assembling markets. Further distribution of wheat is

handled by others until it reaches to the end users. The marketed surplus of wheat, which has
been estimated to about 40 to 50 per cent of production, was sold by the producers through
different channels as indicated under–
1. Village Traders 4. Commission Agents 7. Procurement Agencies
2. Itinerant Traders 5. Flour Millers 8. Retailer
3. Wholesalers 6. Cooperative Agencies 9. Exporter
41

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4.2.1 Inter-state Movement :
Punjab (3,44,71,640 M.T.), Haryana (1,89,56,510 M.T) and Uttar Pradesh (70,34,200
M.T) were first three major inter-state trading states of wheat. These states catered to the need
of nearly all states. Though Bihar, Madhya Pradesh and Rajasthan were also major producers.
However, inter-state movements from these states were not substantial. Wheat from Bihar was
despatched to Andhra Pradesh and West Bengal and other neighbouring states. Rajasthan
(83,20,139 M.T) ranked the list of purchasers followed by Gujarat (83,20,139 M.T) and West
Bengal. However, wheat was despatched from Rajasthan to Andhra Pradesh, Tamil Nadu and
West Bengal. Uttar Pradesh despatched wheat to Assam, West Bengal and Bihar from
Powayan, Bareilly and Pilibhit markets, whereas Kanpur market dispatched wheat to Delhi and
Gujarat state.

Jalna and Dhule markets of Maharashtra despatched wheat to Gujarat, Madhya Pradesh
and West Bengal to the tune of 50 – 60 per cent of the arrivals. Karnataka also dispatched
wheat to Tamil Nadu, Andhra Pradesh and Kerala from Bangalore (Urban), Gadag and Nargund
markets. State-wise despatches are given in Table No.22.

MOVEMENT OF WHEAT FROM UTTAR PRADESH

TO OTHER STATES DURING 2000 – 2001
Qty in 000’ tonnes

Punjab(3.24) Other states(0.3)

Rajasthan(2.6)
Top
North Eastern
States (255.3)

Gujarat (0.4) UTTAR

PRADESH
Bihar (4.1)

Maharashtra (8.14)
West Bengal (4.2)

Madhya
Pradesh
(0.22)
Karnataka (103.1) Orissa (140)

Andhra Pradesh (34.4)

Kerala (24.0) Tamil Nadu (131.1)
Top
42
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Table No. 21
Interstate Movement of Wheat During 2000 – 2001
(Quantity in 000’ tonnes)
Sl. Exported A.P. Bihar Chan- Delhi Har- Karna- M.P Punjab Rajas- Tamil U.P. West
No. from Ö digarh yana taka than Nadu Bengal
Ø
To
1. A.P. 78.1 10.0 - 1.20 16.1 19.0 0.23 67.1 3.2 - 34.4 -
2. Bihar - - - - 235.0 - 0.1 422.2 - - 4.1 4.1
3. Delhi - - - - 73.4 - - 45.1 2.7 - - -
4. Gujarat - - - 0.33 231.0 - - 596.0 0.5 - 0.4 4.32
5. Haryana - - - - - - - 7.0 - - - -
6. Karnataka 7.1 - 2.41 40.1 80.0 - - 200.4 2.20 5.0 103.1 -
7. Kerala - - - 140.2 22.14 0.3 0.03 37.0 2.0 7.0 24.0 -
8. M.P. 0.3 - 0.21 - 99.3 - - 220.0 2.0 - 0.22 -
9. M.S. - - 5.1 5.1 231.1 - - 656.0 1.40 - 8.14 -
10. Orissa 11.3 - - 4.25 35.15 - - 40.0 - - 140.0 4.0
11. Punjab - - - 0.10 9.04 - - - - - 3.24 -
12. Rajasthan 5.22 - - 0.41 381.0 - - 446.4 - - 2.60 -
13. Tamil 7.42 - - 209.1 46.0 - 0.05 139.1 53.14 76.1 131.1 -
Nadu
14. U. P. - - - 2.34 52.0 2.22 - 140.4 1.9 - - 2.0
15. W.B. - 24.2 - - 341.1 - - 299.1 2.4 - 4.2 122.0
16. N.E.R. - - - 18.14 32.20 - - 72.4 - - 255.3 28.02
17. Others - - - - 14.1 - - 61.1 0.60 2.10 10.03 -

TOTAL 109.4 34.2 7.72 428.2 1898.6 20.5 0.41 3449.3 71.14 90.2 711.1 164.4

SOURCE : DGCIS, Kolkata

MOVEMENT OF WHEAT FROM PUNJAB TO Top
OTHER STATES DURING 2000 – 2001
700 656
596
600

500
446.4
422.2
400
299.1
300
220 200.4
200
139.1
104.4
100 72.4 67.1 61.1
45.1 40 37
7
0
NE Region

Haryana
Rajasthan

U.P.

Tamil Nadu

A.P.

Delhi
Gujarat

Karnataka

Kerala
Bihar

West Bengal

M.P.

Other
Maharashtra

Orissa

000' M.T. Top

43
 Top
MOVEMENT OF WHEAT FROM HARYANA TO OTHER STATES
DURING 2000-2001

Table No.22
Interstate Movement of Wheat from Haryana
Qty.in 000 tonnes
Rajasthan 381.0 Uttar Pradesh 52.0
West Bengal 341.1 Tamil Nadu 46.0
Bihar 235.0 Orissa 35.15
Maharashtra 231.1 North Eastern Region 32.2
Gujarat 231.0 Kerala 22.14
Madhya Pradesh 99.3 Andhra Pradesh 16.1
Karnataka 80.0 Others 14.1
Delhi 73.4 Punjab 9.04
Top
44
 Top
4.3 Export and Import :

Import : India imported food grains to the tune of 19.70 and 14.15 lakhs tonnes during 1997-
1998 and 1998-1999 respectively. Food Corporation of India (FCI), was the handling agency for
import, storage and distribution. In the year 1998-1999, 50 per cent custom duty was
imposed on wheat import, resulting into decline of import. Only 1.35 M.T. wheat valued at
Rs.0.84 lakhs was imported during 2001-2002.

Export : The global wheat trade was more than 100 million tonnes. Till 1990, there was
paucity of wheat and domestic prices (Rs.2860 per tonne) were higher as compared to
international prices (Rs.2391 per tonne 1990-1991). However, India emerged as formidable
exporter due to huge generation of marketable surplus and ranked 6th position in world exports.
The major competitors are Canada, USA, Australia and Argentina.

India exported wheat to 23 countries. The major export markets for India were
Bangladesh, United Arab Emirates, Yemen Rep., Phillippines, and Netherlands. It is evident from
the following table that India made quantum jump in export of wheat during 2001 to 2002 in
terms of quantity (29.24 per cent) compared to previous year.
Table No. 23
Quantity and Value of Exports of Wheat by India during 2000-2001 to 2001-2002
Top
Sl. Descrip- Country April, 00 to March, 01 April, 01 to March, 02
No. tion Qty. (MT) Value ‘000’ Rs. Qty. (MT) Value ‘000’ Rs.
1. SEED Bangladesh 730.00 4699.88 1964.98 9656.57
Indonesia 1.00 50.63 385.00 1823.55
Malaysia 100.00 508.20 6550.00 32110.07
Oman N.A. N.A. 27030.00 153666.00
Others 28520.00 148273.52 34734.30 512731.37
Total 29351.00 153532.23 858379.71 709987.56
2. CON- Bangladesh 205110.07 1076558.73 822449.73 4016359.30
SUMPTION
Indonesia N.A. N.A. 73531.85 369616.94
PURPOSE
Malaysia N.A. N.A. 92153.00 487720.71
Philippines 36858.65 213622.20 394245.13 2146693.63
Singapore 18212.00 88007.95 57713.10 273395.94
Sri Lanka N.A. N.A. 31273.00 148384.55
U.Arab 103156.00 492045.15 347169.30 1633093.41
Emirates
Vietnam S.R. 15750.10 75481.41 149004.98 686376.43
Yemen Rep. 56000.00 265951.21 162501.00 775956.34
Others 326567.78 1681470.24 278914.56 1523798.40
Total 761654.60 3893136.89 2408955.55 12061395.65
SOURCE: Director General of Commercial Intelligence & Statistics, (DGCIS),
Kolkata
45
Top
 Top
The export of wheat also showed increase of more than three hundred per cent both in
terms of quantity and value during the same period.

The new Agricultural Policy encompasses commercialization, value addition and market
orientation for both internal and export trade. In post World Trade Agreement (WTA) regime,
export led growth is an important strategy. Devaluations of rupee, permission to PSUs and
private parties to lift from FCI stocks, conditional removal of quantitative restrictions are some of
the measures to boost the exports. The quantity and value of export of wheat during the last four
years may be seen in the following table.
Table No.24
The quantity of Wheat Exported during the 1999-2000 to 2002-2003

Year Quantity (Metric tonnes) Quantity (Rs.in Lakh)

1999 – 2000 3.15 Negligible
2000 – 2001 813492.28 415.09
2001 – 2002 2649380.73 1330.20
2002 – 2003 3671253.97 1759.87

SOURCE : APEDA (Annual Export Information)

Top
The country failed to fully avail the golden opportunity of wheat export due to lack of
adequate and proper infrastructure. Indian wheat is, competitive in terms of price and at
advantageous position in freight charges for export to South Asia. Paucity of rail rakes came in
the way of export though stocks and export orders were available. Exporters are renewing the
early orders on revised prices, which have been enhanced, as they could not fulfill the supply in
stipulated period of six months. The export price of wheat was hiked from Rs.4560 to 4810 per
tonne for old crop and from Rs.4600 to 4950 per tonne for wheat crop procured in 2002-2003
rabi marketing season w.e.f.01.01.2003.

T.durum wheat is having immense potential for export. The bright amber colour, hard
texture and high gluten content are preferred by Pasta Industry. Durum wheat cultivation is being
encouraged by concerned stake holders. Following points are also under active consideration for
promotion of export of wheat and its value added products.

) Long term policy for export, coupled with export promotion

activity.
) To compete in international markets, maintenance of quality
parameters and consistency in quality and supply is essential.
The Government of India in consultation with the concerned
states is working in the direction of legalized contract farming,
direct marketing etc.
) Biscuits, pasta, noodles etc., are being considered to be included
under wheat products so as to permit subsidy.
46
Top
 Top
4.3.1 Sanitary and Phyto-Sanitary Measures (SPS) :
For international market, certain norms are prescribed under SPS agreements, which are
very important. SPS agreement covers aspects related to health i.e. food additives, pesticides
residue, codes and guidelines of hygienic practices, etc.

Sanitary and Phyto-Sanitary Measures (SPS) are applied in four situations.

¾ Risk arising from the entry, establishment or spread of pests, disease, and
disease carrying organisms or disease causing organisms.
¾ Risk coming from additives, contaminants, toxins or disease causing
organisms in foods, beverages or feed stuffs.
¾ Risk arising from diseases carried by animals, plants or products there of or
from the entry, establishment or spread of pests.
¾ Prevention or limitation of damage caused by the entry, establishment or
spread of pests.
¾ Non-compliance of SPS criteria attracts penalties prescribed by WTO.

The exporter / importer is required to maintain bio-security and sanitary, phyto-sanitary,

import risk analysis issued by the Plant Protection and Quarantine authorities (PPQ) under the
Plant, Fruits And Seeds Order, 1989.
Top
Technical Barriers to Trade (TBT): (Including Codex Standards) Technical
Barriers to Trade (TBT) Agreement was revised and converted into multi-lateral agreement
through Uruguay round. It covers all technical requirements and standards, such as product
description, labelling and package specifications, etc., which are not covered under the SPS
agreement.

4.3.2 Export Procedures :

In present WTO regime, the trade is bound, with certain conditions under Agreement on
Agriculture (AoA) such as :

) Member countries to provide market access opportunities upto 5

per cent of their domestic consumption.
) Removal of quantity restrictions on 715 items including 208 items
of agricultural sector.
) Stringent compliance of HACCP, SPS and environment protection
guidelines/ norms.
Similarly, there are conditions for exporters also like:

¾ Registration with RBI, RBI code number.

Top
47
 Top
¾ Importer Exporter code number – to be obtained from D.G.,
Foreign Trade.
¾ Registration-cum-membership certificate from concerned Export
Promotion Councils.
Further, for export consignment the exporter should have following.

) Quality certificate.
) Insurance cover (Marine/Air)
) Certificate of origin – from Chamber of Commerce.

For availing various benefits under Duty Draw-back Scheme certain documents are
needed these are:

 Shipping Bill
 Carting order for export.
 Mail receipt – certificate from Captain of Ship.
 Bills of loading or Air way bill.

4.4 Marketing Constraints :

Top
Lack of proper marketing infrastructure like –

" Storage – Lack of proper and adequate storage facilities at producer’s level
creates problems. Now Government are addressing the problem through Gramin
Bhandaran Yojna and construction of storage by co-operatives.
" Grading – Grading enables the farmer to fetch competitive price but its lack in
the markets is a constraint.
" Transportation – Due to high cost of truck transportation charges coupled with
market glut, majority of the producers dispose of wheat at village level to the village
traders, itinerant merchants, etc. The transport problem is mainly faced by small/
marginal farmers.
" Market Glut – In peak post harvest period, the markets are flooded with wheat
arrivals causing all sorts of problems of storage, selling space, jam on roads etc.
Due to heavy supply and resultant glut in the markets, the distress sales are a
common feature.
" Long Chain of Marketing – Due to, multi-segmented marketing channel, the
producers do not get fair share in consumer’s rupee.

Financial Problems of Producers : The farmers borrow credit from the village
traders at a high rate of interest in anticipation of selling their produce at farm harvest
price.

48 Top
 Top

Lack of Market Information : Farmers are generally not aware of market

information like supply, demand, prices prevailing in the market, market charges, etc.,
which are crucial for decision making at right time. Now with the development of
information technology, wheat producers can get the market information quickly relating to
various markets with in the state or outside the state.

Paucity of Marketing Extension : At present, there is no organised market

extension system to improve the awareness of farmers in order to orient them towards
market driven production, and educate them about the benefits of adoption of modern
post-harvest technology.

5.0 MARKETING CHANNELS, COSTS AND MARGINS :

5.1 Marketing Channels :

Marketing channel is a group of interrelated intermediaries, who market the produce from
the farmers to consumer. Private and Institutional channels are the important marketing
channels in the movement or distribution of major agricultural commodities. Most common
channels for wheat are given below;

I Private – The Marketing channels in private sector are –

Top
1. Farmer Ö Consumer
2. Farmer Ö Retailer or village trader Ö Consumer
3 Farmer Ö Wholesaler Ö Retailer Ö Consumer
4. Farmer Ö Village Trader Ö Wholesaler Ö Retailer Ö Consumer
5. Farmer Ö Wholesaler Ö Miller Ö Retailer Ö Consumer

II Institutional – It covers the public and co-operative sector agencies. It plays a very
important role in the procurement and distribution of wheat. The Food Corporation of India is the
main agency for procurement, maintenance of buffer stocks and distribution of wheat. The main
institutional marketing channels for wheat are as under;

6. Farmer Ö (FCI, State Govt., Co-operatives) Govt. Agency Ö Fair Price

Shop Ö Consumer
7. Farmer Ö Co-operative Marketing Society Ö Retailer Ö Consumer
8. Farmer Ö (FCI, State Govt., Co-operatives) Ö Private Trader Ö Export.

Top

49
 Top
MARKETING CHANNELS OF WHEAT

PRODUCER

Retention on farm home

for consumption, seed, Marketed Surplus
payments in kind

Primary Wholesale
Market Village Market
Weekly Market

Buyers Sellers
Shopkeepers Village
Commission Commission
Agent (pucca Agent (kutcha Moneylenders Consumers
Itinerant Merchant
arhtias) arhtias)

Terminal Market
Wholesaler Government

Retailer Secondary
Wholesaler Roller Fair Price Shop
Flour Mills

Consumer Consumer

Top
50
 Top
Criteria for Selection of Channels :
Short channel, with minimum marketing cost and ensuring reasonable returns to farmer is
considered as cost effective channel. The following are the criteria for section of efficient
marketing channel.

9 Transportation cost in that channel.

9 Commission charges and market margins received by the
intermediaries, such as trader, commission agent, wholesaler and
retailer.
9 Financial resources.

5.2 Marketing Costs and Margins :

Marketing Costs :
The total costs incurred by the producer – seller and by the various intermediaries
involved in the sale and purchase of the produce till the commodity reaches the ultimate
consumer are known as marketing costs. These include –

¾ handling charges for produce at primary place.

¾ assembling charges.
¾ storage and transport cost.
Top
¾ handling charges by wholesaler and retailer.
¾ other expenses on secondary services like, finance, risk, market
intelligence.

Marketing Margins :
Marketing margins are the profits of the various market functionaries involved in marketing
the produce from initial point of production till it reaches to the end user.

Measures for Reducing the Costs and Margins

The marketing cost can be reduced by increasing the efficiency in marketing system.

 Handling of bulk quantity at a time reduce marketing costs and improve

the efficiency.
 Improved methods of handling, packing and efficient use of labour
reduce the marketing costs.
 Adopting proven management techniques reduce the marketing costs.
 Selling value added products reduce the marketing costs.
51
Top
 Top
Marketing margins of agricultural commodities are often higher because of the inherent
risk at various stages of marketing. Following measures may reduce the risk ;

) The adoption of hedging operations, efficient market news services,

grading and
) Increasing the competition in the marketing of farm products.

The absolute value of the total marketing margin varies from market to market, channel to
channel and time to time.

¾ Market Fee – It is charged either on the basis of weight or on the basis of value of the
produce. It is usually collected from the buyers. The market fee differs from state to
state. It varies from 0.5 per cent to 2.00 per cent advaloram.

¾ Commission – The commission charges are usually made in cash. It varies from
market to market. These charges were observed nil in the state of Assam, Kerala,
Madhya Pradesh, Goa, Arunachal Pradesh, Whereas 2-4 per cent in Andhra Pradesh,
Delhi, Gujarat, Haryana, Karnataka and Maharashtra.

¾ Taxes – Different taxes are charged in different markets such as toll tax, terminal tax,
sales tax, octroi, etc. These taxes on wheat differ from market to market in the same state
and also from state to state. These taxes are payable usually by the seller.
Top
¾ Miscellaneous Charges – In addition, some other charges are also levied. These
include handling, weighing, loading, unloading, cleaning, charity contribution in cash and
kind etc. These charges are payable either by seller or by buyers.

Table No.25

Market charges and taxes levied in different states are given below

Sl. State Mar- License fee Market charges Commi- Octroi Sales Remark
No. ket Rs. per Rs. per unit ssion % Tax
fee annum charges %
% %
1. 2. 3. 4. 5. 6. 7. 8. 9.
1. Andhra 1 A- 125 1. Weighing –0.50 1 to 2 Nil 4
Pradesh B- 75 to 0.75
C- 50 2.Unloading -0.50
D- 25 to 0.75
3. Hamal – 0.50
to 0.75
4. Cleaning – 0.75
to 1.00
5. Loading – 0.50
to 0.75.
2. Arunachal 2 Traders –1500 -- Nil Nil Nil
Pradesh Com.Ag.– 1000
Weighmen- 200
Hamal -100

52
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 Top
1. 2. 3. 4. 5. 6. 7. 8. 9.
3. Assam 1 Traders – 10 -- * Nil Nil --- * Markets
are not in
operation
4. Delhi 1 Traders – 1. Weighing– 0.70/ bag 2 Nil ---
A- 100 2. Unloading– 0.70 / bag
B- 100 3.Cleaning– 0.40/ bag
C- 100
D- 100
E- 50
5. Gujarat 0.5 Com. Ag. 100 1.Weighing -1 to 2.5/bag 2 0.2 ---
Traders 2. Unloading- 2.5 to 4
A – 75 3. Brokerage - 6
B – 50 4. Hamal - 1 / bag
C – 5 to 30
6. Goa 1 Traders Cleaning – 100/ Nil Nil --- Entry fee
A – 150 Truck Rs. 10/
B – 100 Truck.
C – 50
7. Haryana 2 Traders 1. Weighing - 0.55 2.50 Nil 4
A – 100 2. Unloading - 0.40
B - 60 3. Brokerage - 0.16
C - 20 4. Hamal - 1.00
5. Cleaning - 0.65
8. Karnataka 1 Traders/ Com. 1. Weighing - 0.50 to 3 2 Nil Nil
Ag. – 200 2. Unloading-1 to 3
Others – 100 3. Brokerage – 0.50 to 10
Retail 4. Hamal - 1 to 3
Traders – 25 5. Cleaning– 1 to 3
9. Madhya 2 Traders – --- Nil Nil N.A. Develop-
Pradesh 1000 ment cess
Processor- from
1000 Traders
only 1 to
5%
10. Maharashtra 0.75 Traders 3 to --- 4 Nil Exm- Entry fee
to 1.0 200 pted Rs.10/
Truck.
11. Meghalaya 1 As per --- Nil Nil Nil
provision of
the Act.
12. Nagaland 2 Traders – 100 1. Weighing – 0.50/Qtl. 2 Nil Nil
2. Unloading – 5.0/Truck
3. Cleaning – 1.0/ Truck
load
4. Service charges – 0.50/
Qtl.
13. Punjab 2 Traders
Rs.300/3 yrs. **
14. Rajasthan 1.60 Traders – 200 1. Weighing - 1 to 2 2 Nil 4 Surcharge
Com.Ag.- 200 2. Unloading – 0.50 to 1 on sales
C.A.Cum.Tr. – 3. Brokerage – 2 tax – 15%
300 4. Hamal – 1 to 4
5. Cleaning – 1 to 2
15. Tripura 2 Traders–20 to 1. Weighing – 2.50 Nil Nil Nil Entry
50 2. Unloading – 2.50 fee Rs.1
3. Cleaning - 5.00 per head.

53 Top
 Top

1. 2. 3. 4. 5. 6. 7. 8. 9.
16. U.P. 2 + Deve- Traders – 250 1. Weighing – 0.50/Qtl. 1.50 Nil 4
lopment Retailers –100 2. Unloading – 0.50/Qtl.
cess 0.50 3. Hamal - 1.0/Qtl.
4. Cleaning – 1.00/Qtl.
5. Brokerage –0.50
17. West 0.50 Traders – 150 No fixed rates, varies as No Nil N.A
Bengal Com.Ag.-200 per local charges for fixed
other activities. rate

**The charges on Procurement of Paddy and Groundnut under contract farming are 11.50 per
cent in Punjab, the break up is Purchase tax – 4 per cent; Cess – 1 per cent ; Market fee – 2 per
cent; R.D.Fund – 2 per cent; Aarhtia charges – 1 per cent; Infrastructure cost – 1.5 per cent.
When entire country is becoming one market it is imperative that there should be uniformity in the
state level tax structure for agricultural commodities.

6.0 MARKETING INFORMATION AND EXTENSION :

Marketing information plays a pivotal role in planning production and marketing of the
produce by the farmers. It is also necessary for the market participants in arriving at optimal
trading decisions. Availability and dissemination of accurate and complete marketing information
is the basic necessity for achieving both operational and pricing efficiency in the marketing
system.

Information Technology in Agril. Research and Development Top

The computer technology pervaded all walks of human life and has become an essential
tool for information. Information technology includes computer programming, data base
management systems, internet, electronic banking, smart card, geographic information system,
computer modeling and expert systems to accelerate agricultural research and development.
Information technology generates useful data bases, information packages on demand,
availability, price, quality and time frame of supply. Inter Ministerial Task Force in its report in
May, 2002 recommended extensive promotion of Information Technology in Agricultural
Marketing.

DMI under Ministry of Agriculture has initiated provision of information in its web-site
during 9th plan. Selected A.P.M.Cs are provided with computer, accessories and software to
disseminate the market information in respect of arrivals and prices on daily basis. So for, 735
markets are connected out of which 650 markets are regularly posting arrivals and rates on
portal, 406 more markets shall have connectivity in2005-06. Post Harvest Profiles of Paddy,
Bengal Gram, Red Gram and Mustard-Rapeseed are already available on website to be followed
by 6 more commodity profiles on wheat, soybean etc, for the benefit of farmers and other market
functionaries.

Some private corporates are also using this technology for mutual benefit of farmers and
organization. ITC’s e-chaupals had made visible impact in production, price realization and
availability of raw material for processing in respect of soybean in Madhya Pradesh. It is also
operating in Uttar Pradesh, Andhra Pradesh, Karnataka and Maharashtra States. So far, more
Top
54
 Top
than 200 E-chaupals are operating. Establishment of “Agriclinic or Agribusiness Centre and
Kisan Cell” are for immediate redressal of problems of farmers on phone. Kisan call centres
have already become operative and are providing guidance to needy farmers.

Marketing Extension :
Liberalization and globalization of markets paved the way for major changes in agricultural
marketing. As such, agriculture has to be market driven, cost effective, innovative and
responsive to high technology information.
Top
Marketing intelligence has to be imparted at the grass root level to farmers, market
functionaries and others engaged in the agricultural marketing activities, such as – market
demand, post harvest management, availability of market finance facilities, etc.

7.0 ALTERNATIVE SYSTEMS OF MARKETING :

7.1 Direct Marketing :

Direct marketing involves sale of wheat by producer to the consumer / miller directly
without any middleman. It enables producers and millers and other bulk buyers to economize
transportation cost and improve price realization. Direct marketing by farmers to the end users
has been experimented in the country through Apni Mandi in Punjab and Haryana. However,
these markets at present are being run at the expenses of the State exchequer as a promotional
measure to encourage marketing by small and marginal farmers.

55
 Top
MNCs are entering into contracts with producers for buying their produce, this is direct
marketing. Flour millers are also directly negotiating with producers and buying their wheat at
their farm gates by paying immediately. In Madhya Pradesh earlier purchase at the doorsteps of
farmer was not possible because of restrictions as per Agricultural Produce Marketing
Regulation Act. Recently, the Andhra Pradesh Government has proposed to privatize loss
making Rythu Bazars to make them economically viable.

Benefits of Direct Marketing

$ It increases price realization of the producer.
$ It minimizes marketing cost, transportation cost.
$ It encourages distributional efficiency.
$ It satisfies the consumer through better quality of produce at
reasonable price.
$ It encourages direct interaction between producers and consumers.
$ It encourages the farmers for retail sale of their produce, thus their
involvement in marketing process and help in discovering the demand
of markets for future market oriented planning.

7.2 Contract Farming : Top

Contract farming is an agreement between buyer and producer for the purchase of
produce at mutually agreed price under forward agreement. In such arrangement, the purchaser,
may be exporter or processing unit, generally provides inputs, technical know-how and financial
support. Thus sharing the risk by both the, buyers and sellers. “It is an approach that can
contribute to increased income to farmers, avoidance of risk of adverse price fluctuation,
and higher profitability to sponsors”.

Many companies like Pepsi Food Ltd., Rallis India Ltd., Mahindra Sublabh, Escorts Ltd.,
have entered into contracts with farmers for production and marketing of wheat. These are
success stories of contract farming. ACC, further developed the concept with backward (farmer)
and forward (technology unit) integration successfully.

Rallis India Ltd. started contract farming for wheat in Madhya Pradesh and Uttar Pradesh.
The company is providing seeds, fertilizers and financial support through SBI. Rallis India Ltd.
has buy-back arrangements with Hindustan Lever Ltd. for wheat in Madhya Pradesh. This is a
first State Bank of India tie up with corporate sector in contract farming, with forward linkage with
HLL.

However, there are instances where one party backs out leaving the other. Generally the
small / marginal farmers are left high and dry. It caters to the need of large farmers ignoring the
small and marginal farmers in the absence of any legal binding.

Top

56
 Top
During National Seminar on Role of Private Sector in Agricultural Marketing -3rd
September, 2001, a number of recommendations were made. Some of the pre-requisite for
success are;

¾ Review of “Land Ceiling Act” and “Leasing of Land” – Land

reforms should facilitate aggregation of land for economic
cultivation and agri-practices.
¾ State Govts. should come out with a detailed policy on contract
farming so as to attract M.N.Cs or big Corporates. The policy may
provide- Financial benefits in form of exemption of taxes, import
of inputs, exemption from market fee.
¾ Legal framework with tripartite arrangement between farmer,
buyer and Govt. or Quasi judicial system of contract enforcement.
¾ Fast track sanitary and phyto-sanitary clearance.
¾ Inclusion of small and marginal producers.
¾ Risk consideration. Top
Directorate of Marketing and Inspection (DMI), Ministry of Agriculture, Govt.of India has
already drafted Model Agreement for contract farming. Since the contract farming can not be
implemented without modifying the Agricultural Produce Marketing (Regulation) Act, the DMI has
prepared a draft of model act of Agricultural Produce Marketing (Development and Regulation)
Act, 2003, wherein a model agreement for contract farming has also been incorporated. This is
reproduced at Annexure No.III. States like Punjab, Maharashtra and Madhya Pradesh have
amended their respective Agricultural Produce Market Acts and initiated contract farming. In
Madhya Pradesh, the taxes have been rationalized and buyers have been permitted to go to
producer’s door steps.

Benefits :
" Sharing and minimizing the price risk due to future fluctuations.
" It promotes use of quality seeds, inputs and new technology resulting
in to assured quality produce.
" It ensures regular and timely payments through bank tie up, assured
quality supply to buyers / processors.
" It minimizes malpractices by elimination of middlemen.
" It strengthens mutual relationship between producers, sellers and
buyers.

Top

57
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7.3 Co-operative Marketing :
“Co-operative Marketing” is a system of marketing in which a group of producers join
together to market their produce competitively. Co-operatives are the best instrument to ensure
remunerative prices to the farmers and also to function as a effective interface for stabilizing
marketing prices. Recognizing the positive role of co-operatives, Government have designated
them as Nodal Agency for price support operations of various agricultural commodities. The
co-operative structure in the different states consists of three levels;

’ PCMS (Primary Co-operative Marketing Societies) at the mandi level.

’ SCMF (State Co-operative Marketing Federation) at state level.
’ NAFED (National Agricultural Co-operative Marketing Federation of India Limited)
at the National level. Besides the National Co-operative Development Corporation
(NCDC) was created in 1962. In the year 2000-2001, the NCDC released an
assistance of Rs.14267 lakhs for marketing and input activities.

Co-operatives continued to play an important role for procurement of wheat as agents of

Food Corporation of India (FCI) under the Price Support Scheme of the Government of India
during 1999-2000. Co-operatives procured 45.19 lakh tonnes of wheat through 4680
procurement centres located in five major wheat growing states.
Table No.26
Procurement of Wheat in Major Producing States 1999-2000
Top
(Qty. in Million tonnes)
Sl. State Co-operatives Central Pool
No. No. of Centres Quantity (Qty)
1. Haryana 296 16.84 380.7
2. Punjab 940 5.41 783.1
3. Rajasthan 103 2.60 63.7
4. Uttar Pradesh 3196 6.22 126.1
Total 4525 31.07 135.99
SOURCE : Deptt. of Agril. and Cooperation, Ministry of Agril., Govt.of India.

7.4 Forward and Future Markets :

Forward and future markets are important tools of price stabilization and risk
management. Extension of future markets to all major agro-commodities was reflected in the
National Agricultural Policy of Government of India announced in the year 2002 and the budget
speech of the Finance Minister (2002-2003)

Commodity future markets in the country are regulated under Forward Contracts
(Regulation) Act, 1952. The Forward Markets Commission under provisions of Section-3 of the
Act performs advisory, monitoring, supervisory and regulatory functions in futures and forward
trading. The exchanges are owned by the associations registered under the Act. At present,
about 25 commodity exchanges are operating.
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Broadly, three types of derivative transactions are being transacted (i) Forward
Contracts (a) Non-Transferable Specific Delivery Contract (NTSD) and (b) Transferable
Specific Delivery Contract (TSD). The exchanges are specifically allowed for NTSD, forward
contracts are not permitted. If the exchange is allowed for hedge contracts can not undertake
NTSD / TSD, unless it is specifically permitted. Thus, there is compartmentalization between
commodity exchanges and financial derivative exchanges. (ii) Ready Delivery Contract -
In such cases, quality, quantity, place of delivery and time are standardized. Only, rate is
negotiable. Delivery of goods and payment thereof is completed within eleven days of contract.
Such contracts are outside the Act. (iii) Option in Goods – An agreement for the purchase
of sale or a right to buy or sale. Options in goods are totally prohibited under the Act.

Till February, 2003, the future trade in food grains was banned. The National Multi-
Commodity Exchange (NMCE), Ahmedabad offers future trading from March, 2003 in food
grains as the proposal has already been approved by the Forward Markets Commission (FMC).
As per report, 493,800 tonnes of foodgrains valued at Rs.470 crores has been traded till March,
2004. The future trading in wheat from 13th December, 2003 to 26th February, 2004 was 89000
tonnes worth Rs.73.4 crores. Future trading in wheat is expected to relieve the Government from
MSP expenditure and FCI its storage costs.

Commodity futures trading in the country suffer certain limitations viz., Top
¾ Limited and closed nature of members. In most of the agricultural
commodity exchanges, less than 10 per cent of the registered members
are actually actively trading.
¾ Absence of many hedgers, other national exchange i.e. Multi-
Commodity Exchange (MCX) Mumbai and National Commodity and
Derivatives Exchange (NCDEX) became operative from October and
December, 2003, respectively.
¾ Absence of legal framework for warehouse receipt system with full
negotiability and transferability.

Benefits of Forward Marketing

" Price discovery mechanism – Producer can get an idea of future pricing
and thus select suitable beneficial commodities.
" Price Risk Management – It helps the exporter in quoting a realistic
price and facility of hedging or insurance to producer or dealers
" Price Stabilization – In times of violent price fluctuation, future markets
help in price stabilization.

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8.0 INSTITUTIONAL FACILITIES :

8.1 Marketing Related Schemes of Government and Public Sector

Organizations
Name of the
Scheme / Facilities provided / Salient features / Objectives
Implementing
Organization
1. 2.
1. Gramin ¾ It is a capital investment subsidy scheme for
Bhandaran construction/renovation/expansion of rural godown. The
Yojana (Rural scheme is implemented by DMI in collaboration with
Godown Scheme) NABARD and NCDC. The objectives of the scheme are to
create scientific storage capacity with allied facilities in rural
areas.
Directorate of
¾ To prevent distress sale immediately after harvest.
Marketing and
Inspection, Head ¾ To promote grading and quality control and improve
Office, NH-IV, marketability.
Faridabad. ¾ To promote pledge financing and marketing credit to
strengthen agricultural marketing in the country by
introduction of a national system of warehouse receipt in
respect of agricultural commodities stored in such
godowns.
¾ The entrepreneur will be free to construct godown at any
place and of any size except for restrictions that it would be
outside the limits of Municipal Corporation area and be of a
minimum capacity of 50 M.T.
¾ The scheme provides credit linked back-ended capital
investment subsidy @ 25 percent of the project cost with a
ceiling of Rs.37.50 lakh per project. For the projects in
North-Eastern states and hilly areas with altitude of more
than 1000 m. above mean sea level and SC/ST
entrepreneurs, maximum subsidy admissible is Rs.50.00
lakh @ 33 percent of the project cost.
2. Agmark Grading ¾ Promotion of grading of agricultural and allied commodities
and under Agricultural Produce (Grading & Marking) Act, 1937
Standardization and rules made there under.
¾ Agmark specifications for agricultural commodities have
Directorate of
been framed, based on their intrinsic quality. Food safety
Marketing and
factors are being incorporated in the standards to compete
Inspection, Head
in world trade. Standards are being harmonized with
Office, NH-IV,
international standards keeping in view the WTO
Faridabad.
requirements. Certification of agricultural commodities is
carried out for the benefit of producer and consumer.
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1. 2.
3. Agricultural ¾ To establish a nationwide information network for
Marketing Information speedy collection and dissemination of market data for
Network its efficient and timely utilization.
Directorate of Marketing ¾ To ensure flow of regular and reliable data to the
and Inspection, Head producers, traders and consumers to derive
Office, NH-IV, Faridabad. maximum advantage out of their sales and purchases.
¾ To increase efficiency in marketing by effective
improvement in the existing market information
system, also to help better future planning.
¾ The scheme includes providing connectivity to the
markets State Agricultural Marketing Department
(SAMD) / Boards. These concerned nodes are being
provided with on computer and its peripherals. The
SAMD/Boards/Markets collect desired market
information and pass on to respective state authorities
and Head Office of the DMI for forward dissemination.
National Agriculture Policy has proposed for coverage
of another 2000 nodes during the Tenth Plan.
4. Price Support Scheme ¾ Nodal agency of Government of India to undertake
(PSS) procurement of wheat under price support scheme.

Food Corporation of ¾ Provides regular marketing support to the farmers to

India, Barakhamba Lane, sustain and improve the production of wheat.
Cannaught Place, ¾ Scheme was operative in Punjab and Haryana at nodal
New Delhi-110 001 point of clusters of wheat producing villages.
5. Co-operative ¾ To correct regional imbalances and to provide needed
Marketing, Processing momentum to the pace of development of various
Storage etc. programmes of Co-operative Agricultural Marketing
Programmes in Processing, Storage etc. in under/least developed
Comparatively under / states/UTs by providing financial assistance on liberal
least developed states. terms to augment the income of farmers and weaker
sections of the community.
National
¾ The scheme provides for distribution of agricultural
Co-operative
inputs, development of agro-processing including
Development
storage, marketing of food grains and
Corporation,
plantation/horticulture produce, development of
Hauz Khas,
weaker and tribal sections, cooperatives, in dairy,
New Delhi – 110016
poultry and fisheries.

8.2 Institutional Credit Facilities :

Adequate and timely availability of finance to producer, specially the small and marginal
farmers, is an important impediment. Generally, farmers depend on money lenders, whose
interest rates are very high. Therefore, institutional credit at reasonable / subsidized rates is vital
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for their well being. Accordingly, National Agricultural Policy had taken note of it. The Task Force
on Agricultural Credit has estimated Rs.736570 crores for five years during Xth Five Year Plan.
The target fixed for year 2002-2003 for agriculture credit was Rs.82,073 crores. Another
important feature of policy is timely and adequate credit flow to small and marginal farmers.

The credit is offered for short, medium and long term periods. During the year 2002-2003,
the target shares for rural credit were through cooperatives to the tune of 43 per cent,
Commercial Banks 50 per cent and Regional Rural Banks 7 per cent. The Commercial Banks
are also expanding their branches and facilities in rural areas due to RBI directions. The total
rural branches as on 30.06.2001 were 32,574, 49.4 per cent of total branches of all Commercial
Banks.
Table No.27
Short Term and Medium Term Loans

Sl. Name of Eligibility Objective / Facilities

No. Scheme
1. 2. 3. 4.
1. Crop Loan All ¾ To meet cultivation expenses for various
categories crops as short term loan.
of farmers ¾ This loan is extended in the form of direct
finance to farmers with a repayment period
not exceeding 18 months.
2. Produce All ¾ This loan is given to help farmers to store
Marketing categories produce on their own to avoid distress sale.
Loan of farmers ¾ This loan also facilitates immediate renewal of
crop loans for next crop.
¾ The repayment period of the loan does not
exceed 6 months.
3. Kisan All ¾ This card provides running account facilities
Credit Agriculture to farmers to meet their production and
Card clients contingency needs.
Scheme having ¾ Procedures are simplified for obtaining crop
(KCCS) good track loans, as and when need arises. Money can
record for be drawn by using conventional withdrawl
the last two slips.
years. ¾ Credit limit depends on operational land
holdings, cropping pattern, etc. subject to
minimum Rs.3000/-
¾ The Kisan Credit Card is valid for 3 years
subject to annual review.
¾ It also covers personal insurance against
death or permanent disability for which a
maximum amount Rs.50,000 and Rs.25,000
respectively is given.

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1. 2. 3. 4.
4. National Scheme is ¾ To provide insurance coverage and financial
Agricultural available to support to the farmers in the event of failure
Insurance all farmers of any of the notified crop as a result of
Scheme loanee and natural calamities , pests and diseases attack.
(NAIS) non-loanee ¾ To encourage the farmers to adopt progressive
both, farming practices like, high value in-puts and
irrespective high technology.
of the size ¾ To help stabilization of farm incomes,
of their particularly in disaster years.
holding.
¾ General Insurance Corporation of India (GIC)
is the implementing Agency.
¾ Sum insured may extend to the value of
threshold yield of the area insured.
¾ Covers all food crops (cereals, millets and
pluses), oilseeds and annual
commercial/horticultural crops.
¾ Provides subsidy of 50 percent in premium of
small and marginal farmers. The subsidy will
be phased out over a period of 5 years on
sunset basis.

LONG TERM LOAN Top

Sl. Name of Eligibility Objective / Facilities
No. Scheme
1. 2. 3. 4.
1. Agricultural All categories of ¾ The banks extend this loan to farmers
Term Loan farmers are to create assets facilitating crop
eligible, provided production/income generation.
they have
¾ Activities covered under this scheme
necessary
are land development, minor irrigation,
experience in the
farm mechanization, plantation and
activity and
horticulture, dairying, poultry,
required area.
sericulture, dry land, waste land
development schemes, etc.
¾ This loan is offered in the form of direct
finance to farmers with a repayment
span of minimum 3 years and
maximum 15 years.
¾ Government of India had directed hike
of 30 per cent quantum of farm credit
over previous year for 2004-2005.

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8.3 Organizations / Agencies Providing Marketing Services :
Sl. Name of the Services Provided
No. Organization / Agencies
1. 2. 3.
1. Directorate of Marketing ) To integrate development of marketing of agricultural
and Inspection (DMI) and allied produce in the country.
NH-4, CGO Complex, ) Promotion of standardization and grading of
Faridabad – 121 001 agricultural and allied produce.
Website : ) Market development through Regulation, Planning
www.agmarknet.nic.in and Designing of physical market.
) Liaison between the Central and State Governments
through its regional offices (11) and sub-offices (37)
spread all over the country.
) Human resource development through various
training programmes for better marketing.
) Assisting State authorities in dissemination of market
informations (MRIN)
2. Food Corporation of ) Procurement of foodgrains for effective price support
India (FCI), operations for safeguarding the interest of the
Barakhamaba Lane, farmers.
Cannaught Place, New ) Distribution of foodgrains throughout the country for
Delhi-110001 Public Distribution System, especially to Below
Website : Poverty Line (BPL) population.
www.fciweb.nic.in ) Maintains satisfactory level of operational/buffer
stocks of foodgrains to ensure National Food
Security.
3. Central Warehousing ) Provides scientific storage and handling facilities.
Corporation (CWC) ) Offers consultancy services/training for the
4/1 Siri Institutional construction of warehousing infrastructure to
Area, Opp.Siri Fort different agencies.
New Delhi-110016 ) Import and export warehousing facilities.
Website : ) Provides disinfestations services.
www.fieo.com/cwc/
4. Agricultural and ) Development of scheduled agriculture products
Processed Food related industries for export.
Products Export ) Provides financial assistance to these industries for
Development Authority conducting surveys, sensibility studies, relief and
(APEDA) subsidy schemes.
NCUI Building 3, Siri ) Registration of exporters for schedule products on
Institutional Area payment of nominal.
August Kranti Marg,
) Adapting standards and specification for the purpose
New Delhi-110016
of export of scheduled products.
Website : ) Carrying out inspection of meat and meat products
www.apeda.com for ensuring the quality of products.
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1. 2. 3.
4. Agricultural and Processed ) Improving the packaging of the scheduled
Food Products Export products.
Development Authority ) Promotion of export oriented production and
(APEDA) development of scheduled products.
NCUI Building 3, Siri ) Collection and publication of statistics for
Institutional Area August improving marketing of scheduled products.
Kranti Marg, New Delhi-
) Training in the various aspects of industries,
110016
functionaries related to the scheduled products.
Website :
www.apeda.com
5. National Co-operative ) Planning, Promoting and Financing Programmes
Development Corporation for production, processing, marketing, storage,
(NCDC) export and import of agricultural produce.
4, Siri Institutional Area, ) Financial support to Primary, Regional, State and
New Delhi-110016 National level co-operative marketing societies
is provided towards;
Website :
www.ncdc.nic.in i) Margin Money and Working Capital
Finance to augment business operations
of agricultural produce.
ii) Strengthening the share capital base and
iii) Purchase of transport vehicles.
6. Director General of Foreign ) Provides guidelines / procedure for export and
Trade (DGFT) import of various commodities.
Udyog Bhavan, ) Allot import-export code number (IEC No.) to the
New Delhi exporters of Agricultural commodities.
Website :
www.nic.in/eximpol
7. State Agricultural Marketing ) Implementation of the regulation of markets in the
Boards (SAMBs), At State state.
Capitals ) Provide infrastructural facilities for the marketing
and Marketing Directorates of notified agricultural produce.
) Provide grading service in the markets.
) Co-ordinate all the market committees for
providing information services.
) Provide aid to financially weak or needy market
committees in the form of loans and grants.
) Eliminate malpractices in the marketing system.
) Arrange seminars, workshops or exhibitions on
subject relating to agricultural marketing and
farmers training programme on various aspects
of agricultural marketing.
) Some of the SAMBs are also promoting agro-
business.
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9.0 UTILISATION: Top
According to report prepared by the Working Group on Demand and Supply Projections,
the per capita per annum consumption of wheat was at 60.75 kgs. (2001-02). On October, 2004
the wheat stock was 14.2 million tonnes against the minimum requirement of 11.6 million tonnes.
Thus stock position of wheat was appreciably comfortable.

9.1 Processing :
Initial processing like dehusking, shelling, drying and cleaning add value to wheat and
reduce handling and storage costs. The value addition in bread industry is only 12 per cent
against 92 per cent in USA. Before consumption, wheat is parboiled, wheat flour (atta), refined
flour (maida) and grits (suji, dalia) are utilized for various end uses. Wheat flour is obtained by 5-
10 hp burr mills, whereas maida and suji are produced in roller mills with 13 per cent bran and 3
per cent germ as by products.

Milling of Wheat – In our country, there are about 2,60,000 small flour mills engaged in
primary milling and 820 (1999) large flour mills using about 10.5 million tonnes of wheat.

$ Traditional Stone Grinder – Whole wheat is ground with bran and germ.
$ Modern Flour Mill – The object is to obtain maximum amount of flour from
endosperm without any bran or germ content. Generally, yield of white flour is about 70
per cent and mill feed (Bran – 12, Germ – 3 and shorts 15 per cent) 30 per cent by weight.

The following steps are involved in wheat milling -

Top
Wheat ¾ Receiving, drying and storage.
Ø ¾ Cleaning – To remove impurities like sticks, stones,
Drying sand, dirt, other food grains, defective food grains etc.
Ø Lastly, the wheat is washed.
Cleaning ¾ Conditioning – The temperature of wheat should not
Ø be raised above 470 C so that gluten quality is not affected.
Conditioning Hydrothermal treatment is used for conditioning because both
Ø moistening and heating are carried out simultaneously.
Milling ¾ Grinding – Is carried out by roller mills – break roll, reduction roll
Ø systems and scratch system generally. In break rolls the bran
Packaging is cracked and kernel is broken. The endosperm adhering
Ø to bran is milled.
Blending ¾ Packaging and Storage – End products are packed in
waterproof bags and stored in cold dry conditions.
¾ Blending – Increasing health consciousness amongst the
consumers, some blending of flours is being carried out e.g. soybean
flour, fortification of flour by adding Calcium carbonate, vitamins A
and D, Thiamine, Riboflavin.
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Table No.28
Position of Roller Flour Mills in India

Year (1st Jan.)

1960 1970 1980 1990 1996 2001 2003
No. of units 127 211 205 516 812 820 516
Estimated Capacity 2.9 5.4 7.4 11.25 19.20 19.50 19.50
(Million tonnes)
Utilization 1.6 2.7 3.6 8.00 12.00 12.50 12.50

SOURCE : Annual Report of Ministry of Food Processing, Govt. of India.

9.2 Uses :
As per the survey on marketable surplus conducted by DMI, 65.1 per cent was estimated
as marketable surplus at the farmer’s level. The total utilization by the farmer worked out to 31.7
per cent of the production, whereas about 3.2 per cent was physically lost. The details are given
hereunder:
Table No.29
Percentage of Utilization and Losses of Wheat at the Farm Level Top

Sl No. Items Percentage

I. Production 100
II. Utilization and Losses
1. Retention by farmers for family consumption. 4.6
2. Purchased for family consumption 6.3
3. Receipts as wages in kind 1.1
4. Total quantity utilized for family consumption (1+2+3) 12.0
5. Other uses 19.7
6. Total utilization 31.7
7. Physical losses 3.2
8. Total utilization and physical losses 34.9
III. Marketable Surplus (productin – total utilization + physical 65.1
losses)

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In the same survey, the utilization of wheat for different purposes was also estimated,
which is given in the following table.
Table No.30
Utilization of Wheat for different purposes in India
Sl. No. Purpose Percent to production
I. Consumption by farmers (Retention + 12.0
Purchases and Wages in kind) 4.6 + 7.4
II i) Seed purpose 7.9
ii) Animal feed 0.9
iii) Barter transaction 0.1
iv) Payments in kind 4.2
v) Payments in cash 4.0
vi) Consumption by temporary labour 0.1
vii) Consumption by permanent labour 2.5
Total 19.7
Grand Total 31.7

However, as per the recent study conducted by the Directorate of Marketing and
Inspection, the marketable surplus was estimated to be 53.81 per cent, whereas, the retention by
farmer was found to be 36.83 per cent of average production.
Top
The other traditional uses of wheat can be summarized as follows :

1. 2. 3.
1. Bread or bakery flour having high level of good quality protein (gluten) and
good gassing power.
2. Biscuit flour having less protein and more extensibility in flour.
3. Confectionary flour for flour similar to biscuit flour but with still less protein and
cakes, buns, puff, etc. controlled particle size.
4. Self-raising flour having special chemicals added to flour to produce
(leavened products on spot) without addition of yeast.
5. House-hold flours medium protein flours with or without added chemicals.
6. Whole meal flour or prepared from wheat after extracting 2-8 per cent bran,
atta used in Indian household for chapatti, Roti tc.
7. High ration flour achieved by dividing flour in different particle sizes by
air classification and thus getting ‘high’ and ‘low’
protein flours from the same parent flour.
8. Enzyme inactivated produced by heat treatment of wheat and used for
flours soups, gravies, thickening agents, etc.

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Wheat contains about 2 to 3 per cent germ, which is generally mixed with bran and sold
as cattle feed. Wheat germ is a rich source of protein (25-30 per cent and vitamin E) and can be
used in Biscuits, breakfast food and high protein drinks. Besides, the wheat gluten dried powder
can be mixed with flour to produce slimming diets, crisp breads, breakfast foods, breads, etc. to
increase their texture and nutritional value.

In so far as utilization of different varieties of wheat is concerned, T.aestivum / vulgare,

the common bread wheat is preferentially used for making Chapaties, bread, biscuits, whereas
T.Durum, known as Macaroni wheat is preferred for making suji, macaroni, spaghetti, vermicelli,
etc. Triticum dicoccum, known as emmer wheat (commercially known as Khapli) is commonly
used in South India for the preparation of breakfast food called Upuma.

Wheat is used for different purposes and hence quality requirements vary on its end use.
Hard wheat (T.aestivum) with strong gluten and > 12.0 per cent protein has been found suitable
for bread making, for biscuits soft wheat with less gluten and < 11.0 protein is best suited.
Whereas for pasta products (T.durum), hard wheat with gluten < 12.5; protein < 10.0 and 7.0
FPM carotene content is required.
Table No.31
Influence of Area on Quality Parameters of Variety PBW 343

Sl. Quality Uttaranchal Punjab Haryana India

No. Parameter Hissar Karnal
LP (16.7) LP (21.0)
1. Flour Data 67.0 71.6 70 70 69.6
(ER)
2. Bread Loaf 510 560 520 550 528
Volume (CC)
3. Biscuits 7.4 7.19 5.57 7.08 6.56
spread factor
ER – Extraction Rate Percentage.
SOURCE: Quality of Indian Wheat. Directorate of Wheat Research (ICAR), Karnal.

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10.0 DO’S AND DON’T’S : Top

Sl. Do’s Don’t’s

No.
1. 2. 3. 4.
A. FARMERS 9Select land after soil testing. X Avoid fields near animal
waste or municipal waste
dumps.
9Supply compost well before X Avoid top dressing and
sowing. Use certified quality seeds human excreta.
of specific variety.
9Harvest at proper time when plants X Avoid early or late
become yellow, grain is hardened harvesting to soy on
and straw become dry and brittle. infestation and shattering,
spilling losses
9Ensure cleanliness and sanitation X Protect from contaminated
of packing areas, packing floors. water and livestock waste
near pack houses.
9Remove foreign matter, damaged, X Do not make admixture of
discoloured, shrivelled immature varieties, sizes, stones,
or grains with greenish tinge on mud, excess bran etc.
seed coat.
9Make uniform lots on size, shape, X Ungraded and improper
maturity, colour and variety and package may result into
grade according to specified less price realization.
standards, in proper pack sizes
and labelling.
9Follow proper storage practices X Grains with more moisture
like drying grains (12 per cent) and attract fungal attack.
hygienic conditions in store house
9Use low cost storage prepared X Do not store in open or
from locally available raw material rooms in loose form.
or bins.
9Old and new grains may be stored X Do not mix the old and new
separately. crops.
9Avoid fungal attack to prevent X Unscientific storage may
aflatoxin, mycotoxin level below 30 result into fungal and pest
mg/kg. attack.
9Use dunnage between floor and X Do not stack bags directly
grain bags on floor.

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1. 2. 3. 4.
A. FARMERS 9Use permitted, genuine and X Do not use banned
quality insecticides/ pesticides chemicals and residues of
like Aluminum phosphate pesticides heavy metals
(tablets) Malathion (50 per beyond permissible limits
cent) 2-4-D-(0.5 mg.kg), should be restricted.
Carboryl (5 mg/kg) Ethephon
(1.0 mg/kg), EDV ampule etc. in
judicious manner.
9Control rodent to keep uric acid X Unprotected wheat
level below 100 mg/kg by use of
baits (anti co-augulent poison)
or cakes
9Gain first hand knowledge X Do not depend on hearsay
regarding markets, market or village merchants.
charges, prevailing prices in
different markets through
media / internet website- www
agmarknet. nic.in
9 Maintain cleanliness of X Use of traditional methods
workers, agricultural and implements is time
implements, use low cost, more consuming, less effective
efficient and less time and results into inferior
consuming appliances. end products.
9 Avail benefits of Central / State X Do not depend on local
Govt. schemes like Crop money lenders who
Insurance, Storage Insurance, charges high interest rates
Grammeen Bhandaran Yojna,
Financial Assistance on ware
house receipts, supply of
gunny bags, MRIN etc.
9 Be aware of rules and X Do not be guided by
regulations pertaining to ignorant, self proclaimed
marketing and sale of produce. people.
9 Form cooperatives for X One man’s voice is neither
collective bargaining power heard nor heeded.
and effective redressal of
genuine problems.

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11.0 REFERENCES

A) Text Book

1. Wheat in the Third World by Haldore Hanson – Norman Borlang and R.Glen Anderson.
2. Nutritive Value of Indian Foods by Gopalan, C.et.al.Indian Council of Medical Research
Publication, 1971.
3. Handling and Storage of Foodgrains by S.V.Ingale, 1976
4. Post Harvest Technology of Cereals, Pulses and Oil seeds by Chakraverty.A, 1988.
5. Farm Machinery Research Digest : CIAE, Bhopal, 1997.

B) Annual Reports
1. FAO Production Year Book – 2000, Vol.54.
2. IARI (ICAR), New Delhi – 1998-1999; 2000-2001.
3. National Cooperative Development Corporation, New Delhi – 2000-2001.
4. Agricultural and Processed Food Export Development Authority,
New Delhi – 2000-2001
5. Central Warehouse Corporation, New Delhi – 2001-2002.
6. Department of Agriculture and Cooperation, Ministry of Agriculture, Govt.of India, 2001-
2002; 2002-2003
Top
C) Research Papers
1. Singh H.P. “Marketing Cost, Margin and Efficiency” AMTC Series – 3, 1990
Directorate of Marketing and Inspection, Branch Head Office, Nagpur,
2. N.Y.Z.Faruqi and Singh H.P. “Chapati Making Properties of Indian Wheats” – A
review. Agricultural Marketing Vol.XXIV (1), Page No.105, April, 1981.
3. Behari O.P. “Development of Rural Primary Markets as Growth Centres and
Creation of Storage Facilities : Agricultural marketing”, pp 1 – 6; Oct – Dec, 1991.
4. Agarwal P.K. “Establishing Regional and Global Marketing Network for small
Holders’ Agricultural Produce / Products with reference to Sanitary and
Phytosanitary (SPS) Requirement”, Agriculture Marketing , pp – 15-23; April – June,
2002.
5. Pandey V.K. etal “Role of Cooperative Marketing in India” Agricultural Marketing, pp
– 20-21; Oct – Dec.2002.
6. Atteri B.R. and Bisaria Geeta “Marketable Surplus of Rice and Wheat and Benefits of
Storage to the farmers in India – Agril. Markeitng”, pp – 27-31; April – June, 2003.
7. Singh J and Sidhu M.S. “Foodgrain Losses at Farm Level – Wheat in Punjab:
Productivity”,Vol.44(1), pp – 136-143’ April – June, 2003.
8. Devi Laxmi “In Roads to Contract Farming “Agriculture Today”, pp – 27-35,
Sept.2003.

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9. Sunil Kumar “Role of Futures Markets in Stabilization of Agro Commodity Prices”,
Yojana, pp – 36-40; oct.2003.
10. Sinha A.C. and Singh H.P.“Studies on the Farinographic and Related Characteristics
of Improved Commercial Varieties of Indian Wheats”, 1974, Bull Grain Technol 12(2),
127-131.

D) Other Documents

1. Report of Inter Ministerial Task Force on Agricultural Marketing Reforms, May, 2002.
2. Indian Farming, Sept.2000.
3. Food Corporation of India – Over view, Dec.2002
4. Contract Farming Agreement and its Model Specifications, Deptt. of Agriculture and
Cooperation, Ministry of Agriculture, Sept.2003.
5. Export, Import and Inter-state Movement from Director General of Commercial
Intelligence and Statistics (DGCIS), Kolkata.
6. Guidelines for Exporters, Deptt. of Agriculture and Cooperation.
7. Indian Portal for Wheat and Milling Industry.
8. Marketable Surplus and Post Harvest Losses of Wheat in India, Directorate of Marketing
and Inspection, Branch Head Office, Nagpur (yet to be published)
9. Agricultural Marketing, Statistical Abstract, 2002, National Institute of Marketing (NIAM),
Jaipur.
10. Saxena B.S. and Singh H.P. Background paper for Consultative Committee for Wheat
Specifications, 1979 – DMI.
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11. (i) Contract Farming Ventures in India (A few successful cases).
(ii) Contract Farming Law (cover story) : Agriculture Today, Page Nos.29-37;
Sept.2003.

E) Web sites
1. http://www.Indiamiller.com/index.asp? nid=129
2. www. agmarknet.nic.in
3. www. fao.org
4. www. agricoop.nic.in
5. www. pib.nic.in
6. www. icar.org.in
7. www. fciweb.nic.in
8. www. codexalimentarius.net
9. www. apeda.com
10. www.ecostat.unical.in

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Annexure – I

COMPARATIVE STUDY OF IMPORTANT PROVISIONS IN VARIOUS

STATE AGRICULTURAL PRODUCE MARKET ACTS

Sl. Features BIHAR GUJARAT MADHYA MAHARASHTRA PUNJAB RAJASTHAN UTTAR

No. PRADESH PRADESH
1. 2. 3. 4. 5. 6. 7. 8. 9.
1. Title of the Act/ Rules The Bihar The Gujarat The Madya The Maharashtra The Punjab The Rajasthan The Uttar
Agricultural Agricultural Pradesh Krishi Upaj Agricultural Produce Agricultural Agricultural Pradesh Krishi
Produce Markets Produce Markets Mandi Adhiniyam, Marketing Produce Market Produce Markets Utpadan Mnadi
Act, 1960/ Rules, Act, 1963/ Rules, 1972/1980 (Regulation) Act, Act, 1961/Rules, Act, 1961/ Rules, Adhiniyam, 1964/
1975 1965 1963/1967 1962 1963 Rules/1965
2. Administering Director of Director of Director of Director of Agricultural Director of Director of
Authority of the Act Marketing Agricultural Marketing Agricultural Marketing Marketing Board Agricultural Mandies
Marketing Marketing
Finance
3. Term of Office Three Years Four Years Five Years Five Years Three Years Three Years Five Years
Members of Market [ Sect.9(5)] [Sect.11(4)] [ Sect.11(5)] [ Sect.14(3) ] ( Sect.14) [ Sect.7(3)] [ Sect.13(8)]
Committee Chairman and Vice-
Chairman the office
for 2½ years
4. Superintendence and State Agril. Director of Agril. Director of Director of State Agril. Director of Agril. Agricultural
Control over Market Marketing Board Marketing & Marketing Agril.Marketing Marketing Board Marketing Produce Market
Committee Rural Finance Board
5. Status of the Statutory Statutory Statutory (Sec.40) Statutory (Sec.39 Statutory (Sec.3) Statutory Statutory
Marketing Board (Sec.33 A) (Sec.34) A) (Sec.22 A) (Sect.26 A)
6. Secretaries of Market Secretary shall Secretary shall Secretary shall be a Secretary shall be Secretary shall Secretary shall Secretary shall
Committee be appointed by be appointed by member of State appointed by the M.C be appointed by be a be appointed by
the Govt. or the M.Cs with the Marketing Service with prior approval of the State Govt.servant the Board
Board approval of and shall be the Director Marketing Board appointed by the [Sec.23(2)]
Director appointed by the [Sec.35(1)] [Sec.20(1)] Govt.
[Sec.22(1)] Govt. [Sec.27(2)] [Sec.11 B(2)]
7. Rate of Market Fee 1% advalorem Mzx. – Min. % of Subject to a Such rate may be Note exceeding Max. of 2% Not less than 1%
(Sec.27) advalorem as minimum of 0.5% or decided by M.C. (but 2% advalorem advalorem and not more
may be max. of 2% subject to min. & [Sec.23(1)] (Sec.17) than 1½
prescribed by the advalorem max. rates which may advalorem
M.C. be fixed by the State [Sec.17(iii)(6)]
[Sec.19(1)]
Govt.
(Present rate 1%) [Sec.31(1)]

Contd..2/-

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1. 2. 3. 4. 5. 6. 7. 8. 9.
8. Authority to All licences are Market Market Committee Market Traders licences are Market Committee Market Committee
grant/renewal issued/by the Committee grants/renews Committee issued by the Secretary grants/renews grnats/renews licences
licences to Market grants/renews licences to all grants/renews of the Marketing Board licences to all to all functionaries
market Committee licences to al functionaries licences to all (Sec.9) and licences to functionaries [Sec.17(i)]
functionaries functionaries (Sec.32) functionaries other functionaries are (Sec.14)
[Sec.27(1)] [Sec.7(1)] issued by the Market
Committee
[Sec.13(3)]
9. Appellate Marketing Director/State Director of Director of Marketing Board Director of Agril. Marketing Board
Authority Board/State Govt. Marketing Agril.Marketing (Sec.40) Marketing, State (Sec.25)
Govt. [Sec.27(5)] Divisional State Govt. State Govt.(Sec.42) Govt. (Sec.16)
Commissioner (Sec.9)
(Sec.34)
10. Market Year 1st April – 31st 1st Oct.- 30th 1st Oct.- 30th 1st Oct.- 30th 1st April – 31st March 1st April – 31st 1st April – 31st March
March September September September March
11. Authority to Any officer or Chairman, Vice- Any officer or Any officer or Any officer empowered Secretary of the Secretary of the Market
order servant of Chairman or servant of the servant of by the Board, has Market Committee Committee or nay
production of Market Secretary of Board or Market market power to order or any offer officer authorized by the
account of Committee M.C. or any Committee committee as production of accounts authorized by State State.Govt. or the
traders and authorized by member, officer empowered by authorized by and power of entry, Govt. has power to board, has power to
power of entry, the Chairman or servant State Govt.has M.C. has inspection and seizure order production of inspect, entry, search
inspection and of M.C. has authorized by power to order power to order (Sec.33A) accounts and and seizure.
seizure power to order M.C. has power production of production on power of entry (Sec.36)
production of to entey, search accounts and has accounts and search and seizure
accounts, and seizure power to entry, has power to (Sec.27B)
power of entry (Sec.29) inspection and entry
and seizure seizure inspection and
(Sec.31B) (Sec.20) seizure
(Sec.32A)
12. Agricultural Any produce All produce All produce All produce All produce whether All produce Such items of produce
Produce as whether whether whether processed whether processed or not of whether of whether processed or
defined in the processed or processed or or not of processed or agriculture, horticulture, agriculture, unprocessed of
Act. unprocessed not of agriculture, not of animal husbandry or horticulture, animal agriculture, horticulture,
of agriculture, agriculture, horticulture, agriculture, forest as specified in the husbandry or viticulture, apiculture,
horticulture, horticulture, pisciculture or horticulture, schedule (except wool, otherwise as sericulture, pisciculture,
animal animal forest as specified animal goat hair and camel specified in the animal husbandry or
husbandry, husbandry as in the schedule. husbandry, hair, no livestock or schedule (except forest as specified in the
forest produce, specified in the pisciculture, livestock products are wool and ghee, no schedule and includes
sericulture, schedule. forest as included in the schedule livestock or admixture of two or
pisciculture, as specified in the at present) livestock products more such items.
specified in the schedule. are included in the
schedule. schedule at preset)

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Annexure – II

MODEL AGREEMENT FOR CONTRACT FARMING

(All clauses of the agreement are subject to the respective explanatory notes given under “contents of a model
contract farming agreement”)

THIS AGRFEEMENT is made and entered in to at_____________________on the _________day of

_______________, 2003 between_________________ age __________ residing at ____________________ ,
herein after called the party of the First part (which expression shall unless repugnant to the context of meaning
thereof mean and include his heirs, executors, administrators and assigns) of the one part, and M/s
__________________________ a Pvt./ Public Limited Co. incorporated under the provisions of Companies Act-
1956 and having its registered office at ____________________________ herein after called the party of the
Second part (which expression shall unless repugnant to the context or meaning thereof mean and include its
successors and assigns) of the other part.

WHEREAS the party of the First part is the owner/cultivator of the agricultural land bearing the following
particulars.

Village Gut.No. Area in Hectare Tehsil & Distt. State

AND WHEREAS, the party of the Second part is trading in agricultural produce and also providing
technical know-how in respect of land preparation, nursery, fertilization, pest management, irrigation, harvesting
and alike things.

AND WHEREAS the party of the Second part is interested in the items of the agricultural produce more
particularly mentioned in Schedule – I hereto annexed and at the request of the party of the Second part, party
of the First part has agreed to cultivate and produce the items of agricultural produce mentioned in the Schedule
– I hereto annexed.

AND WHEREAS the parties hereto have agreed to reduce in writing the terms and conditions in the
manner hereinafter appearing.

NOW, THESE PRESENCE WITNESSTH AND IT IS HREBY AGREED BY AND BETWEEN THE
PARTIES AS FOLLOWS:

Clause – 1

The party of the First part agrees to cultivate and produce and deliver to the party of the Second part
and the party of the Second part agrees to buy from the party of the first part the items of the agricultural
produces particulars of the items, quality, quantity and price of the items are more particularly mentioned in the
Schedule – I hereto annexed.

Clause – 2

The agricultural produce particulars of which are mentioned in the Schedule – I hereto will be supplied
by the party of the First part to the party of the Second part within the period of ___________ months/years from
the date hereof.

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Contd..2/-
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It is expressly agreed between the parties hereto that this agreement is for agricultural produce
particulars of which are described in Schedule – I hereto and for a period of _____ months/years and after the
expiration of said period, this agreement will automatically come to an end.

Clause – 3

The party of the First part agrees to cultivate, produce and supply quantity mentioned in the Schedule – I
hereto annexed to the party of the Second part.

Clause – 4

The party of the First part agrees to supply the quantity contracted according to the quality specifications
stipulated in Schedule – I. If the agricultural produce is not as per the agreed quality standards, the party of the
Second part will be entitled to refuse to take the delivery of the agricultural produce only on this count. Then

a) The party of the First part shall be free to sell the produce to the party of the Second part at a
mutually renegotiated price

OR

b) In open market (to bulk Buyer viz. exporter / processor / manufacturer etc.) and if he gets a price
less than the price contracted, he will pay to the party of the Second part, for his investment
proportionately less

OR

c) In the market yard and if the price obtained by him is less than contracted price, then he will
return proportionately less for the party of the Second investment.

In the event the party of the Second part refuses/fails to take the delivery of the contracted produce for
his own reasons then the party of the First part will be free to sell the produce in the open market and if the price
received is lower than the contracted price the difference will be on account of the party of the Second part and
the party of the second part shall pay the said difference to the party of the First part within a period of _______
days from asserting the said difference.

Clause – 5

The party of the First part agrees to adopt instructions / practices in respect of Land preparation,
nursery, fertilization, pest management, irrigation, harvesting and any other, as suggested by the party of the
Second part from time to time and cultivate and produce the items as per specifications mentioned in the
Schedule – I hereto.

Clause – 6

It is expressly agreed by and between the parties hereto that buying will be as per the following terms
and buying slips will be issued immediately after the purchase.

Date Delivery Point Cost of Delivery

It is further agreed that it will be the responsibility of the party of the Second part to take into possession
of the contracted produce at the delivery point agreed after it is offered for delivery and if he fails to take delivery

Contd..3/-

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within __________ period then the party of the First part will be free to sell the agriculture produce contracted as
under :

a) In open market (to bulk Buyer viz. exporter / processor / manufacturer etc.), and if he gets a price
less than the price contracted, he will pay to the party of the Second part for his investment
proportionately less.

b) In the market yard, and if the price obtained is less than contracted price then he will return
proportionately less to the party of the Second part for his investment.

It is further agreed that the quality maintenance in transit will be the responsibility of the party of the
Second part and the party of the First part shall not be responsible or liable for the same.

Clause - 7

The party of the Second part shall pay to the party of the First part the price / rate mentioned in
Scheduled – I when his crop has been harvested and delivered to the party of the Second part after deducting
all outstanding advances given to t party of the First part by the party of the Second part. The following
schedule shall be followed for the payment.

Date Mode of Payment Place of Payment

Clause - 8

The parties hereto shall insure the contracted produce mentioned in Schedule – I hereto, for the period
of _______________against the risk of losses due to acts of Gods destruction of specified assets, loan default
and production and income loss anal other acts or events beyond the control of the parties, such as very low
production caused by the serious outbreak of a disease, epidemic or by abnormal weather condition, floods,
drought, hailstorm, cyclones, earthquakes, fire or other catastrophes, war, acts of Government, action exiting on
or after the effective date of this agreement which prevent totally or partially the fulfillment of the obligation of
the farmer. Upon request, the party of the First part invoking such acts shall provide to the other party
confirmation of the existence of facts. Such evidence shall consist of a statement of certificate of the appropriate
Government Department. If such a statement or certificate cannot reasonably be obtained, the party of the First
part claiming such acts may as substitute, thereof, make a notarial statement describing in details the facts
claimed and the reasons why such a certificate or statement confirming the existence of such facts.
Alternatively, subject to the mutual agreement between the two parties, the party of the First part may fill his
quota of the produce through other sources and the loss suffered by him thereby due to price difference, shall
be shared equally between the parties, after taking into account the amount recovered from the insurance
company, the insurance premium shall be shared equally by both the parties.

Clause – 9

The party of the Second part hereby agrees to provide following services to the party of the First part
during the period of cultivation and post harvest management, particulars of which services are as follows:

1.
2
3
4 Top

Contd..4/-
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:: 4 ::

Clause – 10

The party of the Second part or it’s representatives agrees to have regular interactions with the farmers
forum set up / named by the party of the First part during the period of contract.

Clause – 11

The party of the Second part or it’s representatives at their cost shall have the right to enter the premises
/ fields of the party of the First part to monitor farming practices adopted and the quality of the produce from time
to time.

Clause – 12

The party of the Second part confirms that he has registered himself with the Registering Authority
__________________ on ________________ and shall pay the fees in accordance with the law prevailing in
this regard to the Registered Authority which has jurisdiction to regulate the marketing of agriculture produce
which is cultivated on the land described _____________________ OR The party of the Second part has
registered himself on __________ with a single point registration Authority namely
__________________________ prescribed by the State in this regard. The fees levied by the respective
Registering Authority shall be borne by the party of the Second part exclusively and will not be deducted in any
manner, whatsoever, from the amounts paid to the party of the First part.

Clause – 13

The party of the Second part will have no rights whatsoever as to the Title, Ownership, Possession of
the land / property of the party of the First part nor will it in any way alienate the party of the First part from the
land property particularly nor mortgage, lease, sublease or transfer the land property of the First party in any
way to any other person / institution during the continues of this agreement.

Clause – 14

The party of the Second part shall submit true copy of this agreement signed by both the parties within a
period of 15 days from the date of execution thereof with the __________ market committee / registering
authority as required by the APMR Act / any other registering authority prescribed for the purpose.

Clause – 15

Dissolution, Termination / Cancellation of the Contract will be with consent of both the parties. Such
dissolution or termination / cancellation deed will be communicated to the registering authority within 15 days of
such dissolution, termination / cancellation.

Clause – 16

In the event of any dispute or difference arising between the parties hereto or as to the rights and
obligations under this agreement or as to any claim, monetary or otherwise of one party against the other or as
to the interpretation and effect of any terms and conditions of this agreement, such dispute or difference shall be
referred to arbitration authority constituted for the purpose of Authority declared by State Government in this
regard.

Clause – 17

In case of change of address of any party to this agreement, it should be intimated to the other party and
also to the Registering Authority.
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Contd..5/-
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Clause – 18

Each party hereto will act in good faith diligently and honestly with the other in the performance of their
responsibilities under this agreement and nothing will be done to jeopardize the interest of the other.

In witness whereof the parties have signed this agreement on the _______ day, __________month and
__________ year first above mentioned.

SIGNED, SEALED AND DELIVERED by the withinnamed ‘PARTY ┐

OF THE FIRST PART’ in the presence of ______________________ │
1.______________________________ │
2.______________________________ │
┘

SIGNED, SEALED AND DELIVERED by the withinnamed ‘PARTY ┐

OF THE SECOND PART’ in the presence of ___________________ │
1.______________________________ │
2.______________________________ │
┘

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Schedule – I

GRADE, SPECIFICATION, QUANTITY AND PRICE CHART

Grade Specification Quantity Price / Rate

Grade 1 or A Size, Colour, Aroma etc
Grade 2 or B
.
.
.
.
.
.
.
.

Supporting Legislation on Contract Farming (to be inserted in State APMC Act)

Definition : “Contract Farming” means farming by a person called “Contract Farming Producer
Under a written agreement with another person called “Contract Farming Sponsor” to the
effect that his farm produce shall be purchased as specified in the agreement.

Explanation : ‘Contract Farming Producer’ means individual agriculturist or association

of agriculturist by whatever name called registered under any law for the time being
inforce. In North Eastern States where the ownership or control over the agricultural
lands lies with village panchayats or similar bodies legally recognized, such body will
treated as ‘Contract Farming Producer’.

“Contract Farming Agreement” means the agreement made for contract farming
between Contract Farming Sponsor and Contract Farming Producer.

Procedure : Contract Farming agreements shall be governed in the manner laid down
and Form hereinafter.
of contract
farming 1) Contract farming Sponsor shall register himself with the Market Committee or
agreement with a prescribed officer in such a manner as may be prescribed.

2) The Contract Farming Sponsor shall get the contract farming agreement
recorded with the officer prescribed in this behalf. The contract farming
agreement shall be in form containing such particulars and terms and conditions
as may be prescribed.
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Contd..2/-
 :: 2 :: Top
Notwithstanding anything contained in contract farming agreement, no title,
rights, ownership or possession shall be transferred or alienated or vest in the
contract farming sponsor or his successor or his agent as a consequence arising
out of the contract farming agreement.

3) Disputes arising out of contract farming agreement may be referred to an authority

prescribed in this behalf for settlement. The prescribed authority shall resolve the
dispute in a summary manner within thirty days after giving the parties a reasonable
opportunity of being heard, in the manner prescribed.

4) The party aggrieved by the decision of the prescribed authority under sub-section (3)
may prefer an appeal to an Appellant Authority within thirty days from the date of
decision. The Appellant Authority shall dispose off the appeal within thirty days after
giving the parties a reasonable opportunity of being heard and the decision of the
Appellant Authority shall be final.

5) The decision by the authority under sub section (3) and decision in appeal under sub
section (4) shall have force of the decree of the civil court and shall be enforceable as
such and decretal amount shall be recovered as arrears of land revenue.

6) Disputes relating to and arising out of contract farming agreement shall not be called in
question in any court of law than otherwise provided herein above.

7) The agricultural produce covered under the Contract Farming agreement may be sold to
the Contract Farming Sponsor out side the market yard and in such a case, no market
fees will be levied.

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Annexure – III

MODEL AGREEMENT FOR CONTRACT FARMING

(All clauses of the agreement are subject to the respective explanatory notes given under “Contents of a
model contract farming agreement)
1. Parties to the Agreement
This agreement is executed Between Contract Farming Sponsor, herein after called Party of the
First part.
and
Contract Farming Producer/s herein after called Party of the Second part At__________ on this
_________ day of 2003, on terms and conditions hereinafter mentioned.
2. Description of Farm land covered by the agreement
The party of the Second part agrees to produce and deliver to the party of the First part and the
party of the First part agrees to buy from the party of the Second part, the items of the agricultural
produce described in clause 4, on the lands mentioned (owned/cultivated) below :-
3. Duration of the Agreement
The agricultural produce mentioned in clause 4 will be supplied to the party of the First part within a
period of ___________ Months/Years from the date hereof. OR This agreement is between the
party of the First part and party of the Second part for agricultural produce described in clause 4 for
a period of _____________ Months/years.
4. Description of Farm Produce
The party of the Second part agrees to produce for the party of the First part, the items of
agricultural produce mentioned below as per Schedule 1 annexed herewith.
5. Quantity Specification

The Second party agrees to supply quantity mentioned in the schedule 1, to the First party.
6. Quality Specifications of Commodity Contracted
The Second party agrees to supply the quantity contracted according to the quality specifications
stipulated in Schedule 1. It the agricultural produce is not as per the agreed quality standards, the
party of the First part will be entitled to refuse to take the delivery of the agricultural produce only on
this count. Then
a) The party of the Second part shall be free to sell the produce to the party of the First part at
a mutually re-negotiated price
OR
b) n open market (to bulk Buyer viz. exporter/ processor/manufacturer etc.) and if he gets a
price less than the price contracted, he will pay to the party of the First part, for his
investment proportionately less
OR
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 :: 2 :: Top

c) In the market yard and if the price obtained by him is less than contracted price, then he will
return proportionately less for the party of the First parts investment.

In the event the party of the First part refuses/fails to take the delivery of the contracted produce for
his own reasons then the party of the Second part will be free to sell the produce in the open market and if
the price received is lower than the contracted price the difference will be on account of the party of the
First part and shall be recoverable as per the procedure of law.

b) Cultivation/Input Specifications.
The party of the Second part agrees to adopt instructions/practices in respect of Land
preparation, nursery, fertilization, pest management, irrigation, harvesting and any other, as
suggested by the party of the first part from time to time.
b) Crop Delivery Arrangements
Buying will be as per the following terms and buying slips will be issued immediately after
the purchase.
Date Delivery point Cost of delivery
It will be the responsibility of the party of the First part to take into possession the contracted
produce at the delivery point agreed after it is offered for delivery and if he falls to take delivery within
____________ period then the party of the Second part will be free to sell the agriculture produce
contracted.
b) In the bulk buyer viz. exporter/ processor/ manufacturer etc.), and if it gets a price less than
the price contracted, it will pay to the party of the First part for his investment proportionately
less.
OR
b) In the market yard, and if the price obtained is less than the contracted price then it will
return proportionately less to party of the First part for his investment. Quality maintenance
in transit will be the responsibility of the party of the First part.

9. Pricing Arrangements
The party of the Second part will be paid as per the price/rate mentioned in Scheduled 1 when his
crop has been harvested and delivered to the party of the First part and all outstanding advances
given to him have been deducted. The following schedule shall be followed for the payment.
Date Mode of payment Place of payment

10. Insurance Arrangement.

The party of the First part and the party of the Second part shall insure the contracted produce
mentioned in clause 4, for the period of ________ against the risk of losses due to acts of Gods,
destruction of specified assets, loan default and production and income loss and all other acts or
events beyond the control of the parties, such as very low production caused by the serious
outbreak of a disease, epidemic or by abnormal weather condition, floods, drought, hallstom,
cyclones, earthquakes, fire or other catastrophes, war, acts of Government, action existing on or
after the effective date of this agreement which prevent totally or partially the fulfillment of the
obligation of the farmer. Upon request, the party of the Second part invoking such acts shall
provide to the other party
Contd..3/-

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confirmation of the existence of facts. Such evidence shall consist of a statement of certificate of
the appropriate Government Department. If such a statement or certificate cannot reasonably be
obtained, the party of the Second part claiming such acts may as substitute, thereof, make a
notarial statement describing in details the facts claimed and the reasons why such a certificate or
statement confirming the existence of such facts. Alternatively, subject to the mutual agreement
between the two parties, the party of the Second part may fill his quota of the produce through other
sources and the loss suffered by him thereby due to price difference, shall be shared equally
between the parties, after taking into account the amount recovered from the insurance company.
The insurance premium shall be shared equally by both the parties.

11. Support Services to be Provided by the Party of the First Part.

The First party of the agreement hereby agrees to provide following services to the Second party
during the period of cultivation and post harvest management.

12. Farmer-Management Forum.

The party of the First part or it’s representatives agrees to have regular interactions with the farmers
forum set up/named by the party of the Second part during the period of contract.

13. Monitoring Quality and Yields.

The party of the First part or it’s representatives shall have the right to enter the premises/fields of
the party of the Second part to monitor farming practices adopted and the quality of the produce
from time to time.

14. Registration of Contract farming Agreements and Dispute Resolution Mechanism.

The party of the First part confirms that he has registered himself with the Registering Authority
____________ on _________ and shall pay the fees in accordance with the law prevailing in this
regard to the Registering Authority which has jurisdiction to regulate the marketing of agriculture
produce which is cultivated on the land described in clause2. OR The party of the First part has
registered himself on _____________ with a single point registration Authority namely
____________ prescribed by the State in this regard. The fees levied by the respective Registering
Authority shall be borne by the party of First part exclusively and will not be deducted in any
manner, what-so-ever, from the amounts paid to the party of the Second part.
In the event of any dispute or difference arising between the parties hereto or as to the rights and
obligations under this agreement or as to any claim, monetary or otherwise of one party against the
other or as to the interpretation and effect of any terms and conditions of this agreement, such
dispute or difference shall be referred to arbitration authority constituted for the purpose or Authority
declared by State Government in this regard.

15. Indemnity in favour of party of the Second part.

The party of the First part will have no rights whatsoever as to the Title, Ownership, Possession of
the land/property of the party of the party of the Second part which is particularly described in
clause 2, of this agreement nor will it in any way alienate the party of the Second part from the land
property particularly described in clause 2, not mortgage, lease, sublease or transfer the land
property of the Second party in any way to any other person/institution.

Contd..4/-

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16. Submission of Agreement for Registration.
Copy of this agreement signed by both the parties will be submitted within a period of 15 days by
the party of the First part with the __________________ market committee/ registering authority as
required by the APMR Act/ any other registering authority prescribed for the purpose.

17. Dissolution of Contract.

Dissolution of Contract will be with consent of both the parties and such dissolution deed will be
communicated to the registering authority within 15 days of such dissolution.

18. Change of address of either parties.

In case of change of address of a party, it should be intimated to the other party and also to the
Registering Authority.

Each party hereto will act in good faith diligently and honestly with the other in the performance of
their responsibilities under this agreement and nothing will be done to jeopardize the interest of the
other.

In witness whereof the parties have signed this agreement on the ______ day, ______ month and the
_________ year first above mentioned.

PARTY OF THE FIRST PARTPARTY OF THE SECOND PART

(Authorized signatory, stamp & name)

(Authorized signatory/Thumb Impression & Name)

Witnesses Witnesses
(Name, full address) (Name, full address)

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ANNEXURE - IV
CODEX STANDARD FOR WHEAT (CODEX STAN 199 – 1995)

The Annex to this standard contains provisions, which are not intended to be applied within
the meaning of the acceptance provision of Schedule 4 A(1)(b) of the General Practice of the
Codex Alimentarius.
1. SCOPE : This standard applies to wheat grains and durum wheat grains as
declined in schedule 2 intended for processing for human consumption. It does not
apply to club wheat (Triticum compactum Host.), red durum wheat, durum wheat
semolina or products deriven from wheat.

2. DESCRIPTION :

2.1 Wheat is the grain obtained from varieties of the species Triticum aestivum L.
2.2 Durum wheat is the grain obtained from varieties of the species Triticum Durum
Desf.

3. ESSENTIAL COMPOSITION AND QUALITY FACTORS :

3.1 Quality and Safety Factors General

3.1.1 Wheat and durum wheat shall be safe and suitable for processing for human
consumption.
3.1.2 Wheat and durum wheat shall be free from abnormal flavours, odours, living insects
and mites.

3.2 QUALITY FACTORS SPECIFIC :

3.2.1 Moisture Content

Maximum Level
Wheat 14.5 % m/m
Durum Wheat 14.5 % m/m

Lower moisture limit should be required for certain destinations in relation to the
climate, duration of transport and storage. Governments accepting the Standards are
requested to indicate and justify the requirement to enforce in their country.

3.2.2 ERGOT :

Selerotium of the fungus Claviceps purpurea

Maximum Level
Wheat 0.05 m/m
Durum Wheat 0.05 m/m Top
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Extraneous matter are all organic and inorganic materials other than wheat and
durum wheat, broken kernels, other grains and filth.

3.2.3.1 Toxic or Noxious Seeds :

The products covered by the provisions of these standards shall be free from the
following toxic or noxious seeds in amount which may represent a hazard to the human
health.

Crotolaria (Crotalaria – Spp.), Corn Cockle (Agrostemma githago L.),

Castorbeans (Ricinus Communis L.), Jimson weed (Datura Spp.), and other seeds that
are recognized as harmful to health..

3.2.3.2 Filth :
Impurities of animal origins, - 0.1 % m/m maximum
(including dead insects )
3.2.3.3 Other organic extraneous matter which is defined as organic components
other than edible grains of cereals (foreign seeds, stems etc.)
Maximum Level
Wheat 1.5% m/m
Durum Wheat 1.5% m/m
3.2.3.4 Inorganic extraneous matter which is defined as inorganic components
(stones, dust etc.)
Maximum Level
Wheat 0.5% m/m
Durum Wheat 0.5% m/m

4. CONTAMINANTS :

4.1 Heavy Metals :

The products covered by the provisions of the standards shall be free from heavy
metals in amount which may represent a hazard to human health.

4.2 Pesticides Residues :

Wheat and durum wheat shall comply with those maximum residue limits
established by the Codex Alimentarius Commission for this commodity.

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5. HYGIENE :

5.1 It is recommended that the product covered by the provision of this standard be
prepared and handled in accordance with the appropriate sections of the Recommended
International Code of Practice General Principle of Food Hygiene (CAC / RCP 1-1969, Rev.
2-1985), and other Codes of Practice recommended by the Codex Alimentarius
Commission which are relevant to this product.

5.2 To the extent possible in goods manufacturing practices the cleaned product shall
be free from objectional matter.

5.3 When tested by appropriate methods of sampling and examination, the product,
after cleaning and sorting, and before further processing.

 shall be free from micro-organism in amount which may represent a

hazard to health;
 shall be free from parasites which may represent a hazard to health; and
 shall not contain any substance originating from micro-organisms,
including fungi, in amount which may represent a hazard to health.

6. PACKAGING :

6.1 Wheat and durum wheat shall be packaged in containers which will safeguard the
hygienic, nutritional, technological and organoleptic of the product.

6.2 The containers, including packaging material, shall be made of substances which
are safe and suitable for their intended use. They should not impart any toxic substance or
undesirable odour or flavour to the product.

6.3 When the product is packed in sacks, must be clean, sturdy and strongly sewn or
sealed.

7. LABELLING :

In addition to the requirement of the Codex General Standard for the labelling of
Prepackaged Foods (CODEX STAN 1-1985, Rev 1-1991, Codex Alimentarius Volume 1 A),
the following specific provisions applied.

7.1 Name of the Product :

The name of the product to be shown on the label shall be “ wheat ” or “durum
wheat” as applicable.

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7.2 Labeling of Non-Retail Containers :

Information for non-retail containers shall be given either on the container or to

accompanying documents, except that the name of the product, lot identification and the
name and address of the manufacturer or packer shall appear on the container. However,
lot identification and the name and address of the manufacturer or packer may be replaced
by an identification mark, provided that such a mark is clearly identifiable with the
accompanying documents.

8.0 Methods of Aanalysis :

Sl. Factor / Description Limit Method of Analysis

No. Wheat Durum
Wheat
1. 2. 3. 4. 5.
1. Minimum test weight : the The test weight shall be
weight of a hundred litre 68 70 the weight per ISO 7971-
volume expressed in 1988 expressed in
kilogram’s per hectoliter. kilogram’s per hectoliter
as determined on a test
portion of the original
sample.
2. Shrunken and broken 5.0% 6.0 % ISO 5223-1988 Test
kernels: broken or shrunken m/m max m/m max sieves for cereals
wheat or durum wheat which
will pass through a 1.7 mm x
20 oblong-holed metal sieve
for wheat and through a 1.9
mm x 20 oblong-holed metal
sieve for durum wheat.
3. Edible Grains other than 2.0 % 3.0% ISO 7970-1987 :
wheat and durum wheat m/m max m/m max (Annex C )
(Whole or identifiably broken )
4. Damaged kernels (including 6.0 % 4.0 % ISO 7970-1987 :
pieces of kernels that show m/m max m/m max (Annex C )
visible deterioration due to
moisture, weather, disease,
mould, heating, fermentation,
sprouting, or other causes. )
5. Insect bored kernels : 1.5 % 2.5 % To be developed
kernels which have been m/m m/m
visibly bored or tunneled by
insects.

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